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ETFs to Tap on Oracle's Robust Q4 Earnings


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After the closing bell yesterday, software giant Oracle ORCL reported better-than-expected fiscal fourth-quarter 2019 results. The company beat the Zacks Consensus Estimate for earnings and revenues and issued a solid view.

Earnings per share came in at $1.16, beating the Zacks Consensus Estimate by 9 cents and improving 99 cents from the year-ago quarter. Revenues inched up 1% year over year to $11.14 billion and were above the estimated $10.94 billion (see: all the Technology ETFs here ).

For the fiscal first quarter 2020, the world's second-largest software maker expects total revenues to be flat to up 2% in dollar terms (1-3% in constant currency basis); the range is within the mid-point is  the Zacks Consensus Estimate of 1.65% growth. It projects earnings per share of 80-82 cents with the low end of the guidance matching the current Zacks Consensus Estimate. For fiscal 2020, Oracle expects revenue to grow faster than the previous year and projects double-digi t earnings per share growth.

Solid results and an encouraging guidance pushed shares of Oracle up as much as 7% in aftermarket trade with elevated volumes. The company carries a Zacks Rank #3 (Hold) and has a VGM Score of A. It belongs to a bottom-ranked Zacks Industry ( bottom 38% ).  

ETFs in Focus

ETFs with the highest allocation to this software giant look to be big movers this week and in the next, as investors digest its scores and views. They should closely monitor the movement in these funds and grab any opportunity from a surge in the price of ORCL:

iShares Expanded Tech-Software Sector ETF IGV

This ETF provides exposure to software companies in the technology and communication services sectors by tracking the S&P North American Expanded Technology Software Index. The fund holds a basket of 88 securities with Oracle taking the third spot at 8% of total assets. It is popular with AUM of $2.6 billion and volume is good as it exchanges nearly 479,000 shares a day. The product charges 47 bps in annual fees and has a Zacks ETF Rank #1 (Strong Buy) with a High risk outlook (read: Salesforce to Buy Tableau: ETFs in Focus ).

Invesco Dynamic Software ETF PSJ

This product follows the Dynamic Software Intellidex Index, holding 30 securities in its basket. Out of these, Oracle is the seventh firm accounting for 5% share. The fund has amassed $472.5 million in its asset base and trades in average daily volume of under 70,000 shares. Expense ratio came in at 0.63%. PSJ has a Zacks ETF Rank #1 with a High risk outlook.

Invesco BuyBack Achievers ETF PKW

This ETF follows the NASDAQ US BuyBack Achievers Index, which comprises US securities issued by corporations that have effected a net reduction in shares outstanding of 5% or more in the trailing 12 months. It holds a basket of 173 stocks with Oracle taking the fourth position at 4.75% allocation. PKW has accumulated $1.1 billion in its asset base and trades in average daily volume of 229,000 shares. It charges 63 bps in annual fees (read: Buyback or Dividend: Which ETF Wins YTD & What Lies Ahead? ).

First Trust Cloud Computing ETF SKYY

This fund provides exposure to cloud-computing securities by tracking the ISE Cloud Computing Index. Holding about 28 stocks in the basket, Oracle takes the tenth spot at 4.62% of the assets. The product has been able to manage $2.2 billion in its asset base while seeing a good volume of about 292,000 shares a day. It has 0.60% in expense ratio and a Zacks ETF Rank #2 (Buy) with a Medium risk outlook (read: Play the Cloud Computing Boom with These ETFs ).

Tortoise Cloud Infrastructure Fund TCLD

This ETF invests in companies that have the potential to benefit from the expected growing investments, rapid adoption and fast paced innovation of the cloud industry. It follows the Tortoise Global Cloud Infrastructure Index, charging investors 40 bps in annual fees. The fund holds 46 stocks in its basket with Oracle occupying the seventh position at 4.3% share. It has amassed $2.7 million in its asset base and sees volume of 2,000 shares per day on average (read: Can Global X New Cloud Computing ETF See Success? ).

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Oracle Corporation (ORCL): Free Stock Analysis Report

iShares Expanded Tech-Software Sector ETF (IGV): ETF Research Reports

First Trust Cloud Computing ETF (SKYY): ETF Research Reports

Invesco BuyBack Achievers ETF (PKW): ETF Research Reports

Tortoise Cloud Infrastructure Fund (TCLD): ETF Research Reports

Invesco Dynamic Software ETF (PSJ): ETF Research Reports

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.





This article appears in: Investing , Earnings , ETFs
Referenced Symbols: ORCL , IGV , SKYY , PKW , TCLD



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