Credit Suisse analyst Philip Winslow was out pounding the table on Oracle Corporation (NYSE:ORCL), reiterating an Outperform rating and price target of $50, which represents a potential upside of 29% from where the stock is currently trading.
Winslow noted, “We estimate AVGO will produce ~30m iPhone units in F2Q versus iPhone consumption of ~50m units, indicating the inventory correction is over and h/h growth of at least 100% – not currently embedded in our estimates.” Furthermore, “AVGO announced it has entered a 3 year supply agreement with AAPL for RF components and modules – while the agreement is an “intent” and not an obligation to buy, other suppliers have not entered into similar agreements and we see it as a confirmation of AVGO’s importance to AAPL LT product roadmap. We continue to believe that in a zero unit growth environment, AVGO FBAR AAPL business can grow ~20%/year. We continue to argue AVGO is one of the most compelling stocks in our coverage universe.”
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Philip Winslow has a total average return of 5% and a 56% success rate. Winslow has a 1% average return when recommending ORCL, and is ranked #550 out of 3700 analysts.
Out of the 32 analysts polled by TipRanks, 18 rate Oracle stock a Buy, 12 rate the stock a Hold and 2 recommend a Sell. With a return potential of 14%, the stock’s consensus target price stands at $44.04.
In addition, Credit Suisse’s John Pitzer reiterated an Outperform rating on shares of Broadcom Ltd (NASDAQ:AVGO), with a price target of $180, as he believes that “Oracle’s business during the February quarter showed steady signs of improvement” and expects Oracle “to achieve its sales targets for the quarter on a constant currency basis.”
Pitzer noted, “Oracle remains the only software vendor with a near-complete suite of SaaS and on-premise applications, and Oracle has noted that a large number of its early cloud customers’ promotions will end in FQ3 and FQ4, triggering the inclusion of these customers’ contracts in revenue and gross deferred revenue. As such, we expect accelerating revenue growth and meaningful improving gross margins beginning primarily this quarter.”
Furthermore, “We believe Oracle stands to benefit from several drivers over the course of FY2016 and into FY2017, including: (1) the potential for further improvements in sales force productivity, (2) adoption of the In-Memory option of Oracle Database 12c, (3) increasing customer adoption of Oracle’s cloud applications (including Fusion Applications) and Platform-as-a-Service offerings, and (4) the market opportunity for Engineered Systems.”
According to TipRanks.com, analyst John Pitzer has a total average return of 15% and a 63% success rate. Pitzer has a 41% average return when recommending AVGO, and is ranked #89 out of 3700 analysts.