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Logical Thought
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My name is Mark B. Spiegel and I'm the Managing Member of Stanphyl Capital Management LLC. I can be reached at: mark (at) stanphylcap (dot) com. My twitter feed is @markbspiegel
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I don't have a blog, but here's a link to a WSJ article regarding my thoughts on the "flash crash"
  • Oracle's Blowout Quarter... A Lagging Indicator? 5 comments
    Sep 16, 2010 6:22 PM | about stocks: ORCL
    In light of the obviously weakening macro data these days (most recently, the latest reports from FedEx and the Philadelphia Fed), I found Thursday night's earnings release from Oracle (ORCL) to be suprisingly strong. In that context, how does this headline sound:

    "Oracle Reports Net Income Up 111%... Application Sales Up 42%, Database Sales Up 32%"

    And how about this quote from Larry:

    "We are off to our fastest start in six years," said Oracle CEO, Larry Ellison. "The spectacular growth in our database business demonstrates that we are continuing to take market share from IBM and Microsoft. The world's largest Web sites — from Amazon.com to Yahoo! — rely on the Oracle database to handle huge numbers of users and enormous quantities of information. The Oracle database is the software that powers the Internet."

    And how about this quote from the CFO:

    "... we are seeing the sales and marketing productivity gains that should accelerate revenue growth throughout [this fiscal year}... It should be a great year."

    Want to guess when this press release was from? September 14th, 2000. The stock closed that day at $42.47. On the date of the next earnings release, three months later, it closed at $27.50. In the earnings release three months after that (March 1, 2001) Larry had this to say:

    ""License growth was strong in the first two months of Q3, and our internal sales forecast looked good up until the last few days of the quarter," said Oracle CEO Larry Ellison. "However, a substantial number of our customers decided to delay their IT spending based on the economic slowdown in the United States. Sales growth for Oracle products in Europe and Asia Pacific remained strong. The problem is the US economy."

    The next day, the stock closed at $16.88.




    Disclosure: Short SPY; long SDS
    Stocks: ORCL
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This post has 5 comments:

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  •  
    Nothing to do with the company, they've grown eps consistantly, market was way overvalued back then.
    16 Sep 2010, 09:36 PM Reply Like
  •  
    The point is that extremely optimistic corporate guidance can swiftly turn out to have been wrong, and many of the tech companies 10 years ago turned out to be classic examples of this, as did Intel last month.
    17 Sep 2010, 07:19 AM Reply Like
  •  
    Hey logical boy I think you are right. I think you found the canary in the coal mine. Oracle's earnings are the harbinger of a recession. How did we not see this. I used to follow the number of Tornado sightings but clearly this is better
    16 Sep 2010, 11:08 PM Reply Like
  •  
    How can you post this something like this and expect to maintain any semblance of credibility.

    At the very least you should put a paper bag over your head in the picture.

    You trade for friends and family? Really. I hope thhey are reading the nonesens you put on here. With friends like you who needs Madoff.

    E
    16 Sep 2010, 11:45 PM Reply Like
  •  
    Several months ago, I offered to post my multi-year audited record against yours and you quickly seemed to shut up... The offer is still open.
    17 Sep 2010, 07:18 AM Reply Like
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