Oracle Goes For The Jugular
Stocks: (ORCL)(SAP
Go for the throat. The weak part of the upper body. Bite down hard. Bleed them.
Oracle is pounding SAP in advertising showing the growth of its applications software. Up 83% in the last quarter. Up 56% excluding acquisitions. SAP is up only 10%. Why? Oracle says it is because SAP applications are written in in a proprietary language called ABAP, which is now 25 years old.
This may be the reason that Oracle seems to be taking SAP market share. SAP's license sales grew only 8% in the last quarter. Their annual goal was 15% to 17%, so that is quite a come down. SAP says that it won 110 Oracle customer in the first half of this year, but, if so, one wonders where the revenue is. One July 18, Oracle's president said the company was gaining share from IBM and SAP. At the same time he said the company would have annual EPS growth of 20%. So, SAP and Oracle can't both be right in their boasting.
The market seems to be voting with Oracle. The stock price is $15.50, within a few cents of its 52-week high. The company's price to sales ration is 5.6. SAP AG (ADS) is trading near the low end of its range, at $45.30, down from its high of $57.71. Its price to sales ratio is 4.7.
SAP is still insisting that it will hit its forecast for the year. But, that seems doubtful. If they do miss, it's lookout below.
Douglas A. McIntyre can be reached at douglasamcintyre@gmail.com. He does not own securities in companies that he writes about.
Go for the throat. The weak part of the upper body. Bite down hard. Bleed them.
Oracle is pounding SAP in advertising showing the growth of its applications software. Up 83% in the last quarter. Up 56% excluding acquisitions. SAP is up only 10%. Why? Oracle says it is because SAP applications are written in in a proprietary language called ABAP, which is now 25 years old.
This may be the reason that Oracle seems to be taking SAP market share. SAP's license sales grew only 8% in the last quarter. Their annual goal was 15% to 17%, so that is quite a come down. SAP says that it won 110 Oracle customer in the first half of this year, but, if so, one wonders where the revenue is. One July 18, Oracle's president said the company was gaining share from IBM and SAP. At the same time he said the company would have annual EPS growth of 20%. So, SAP and Oracle can't both be right in their boasting.
The market seems to be voting with Oracle. The stock price is $15.50, within a few cents of its 52-week high. The company's price to sales ration is 5.6. SAP AG (ADS) is trading near the low end of its range, at $45.30, down from its high of $57.71. Its price to sales ratio is 4.7.
SAP is still insisting that it will hit its forecast for the year. But, that seems doubtful. If they do miss, it's lookout below.
Douglas A. McIntyre can be reached at douglasamcintyre@gmail.com. He does not own securities in companies that he writes about.
posted by douglas mcintyre at 10:09 AM
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