After the closing bell yesterday, software giant Oracle (ORCL - Free Report) reported better-than-expected fiscal fourth-quarter 2020 results. The company beat the Zacks Consensus Estimate for earnings and but lagged on revenues.
Earnings per share came in at $1.20, beating the Zacks Consensus Estimate of $1.04 and improving 3% from the year-ago quarter. Revenues fell 6% year over year to $10.44 billion but came in below the estimated $10.66 billion. The decline in revenues came as clients in the hospitality and retail industries delayed software purchases amid the coronavirus pandemic (see: all the Technology ETFs here).
Oracle did not provide any financial outlook for fiscal 2021. Its cloud services revenues will face headwinds from lower spending by impacted industries such as retail, hospitality and transportation.
Oracle shares plunged more than 4% in after-market trading. The company carries a Zacks Rank #3 (Hold) and has a Value Score of A. It belongs to a bottom-ranked Zacks Industry (bottom 44%).
ETFs in Focus
ETFs with the highest allocation to this software giant are likely to be big movers this week and in the next post Oracle results. They should closely monitor the movement in these funds and grab any opportunity from a decline in the price of ORCL:
iShares Expanded Tech-Software Sector ETF (IGV - Free Report)
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 100 securities with Oracle taking the fourth spot at 6.6% of total assets. It is popular with AUM of $4.4 billion and volume is good as it exchanges nearly 887,000 shares a day. The product charges 46 bps in annual fees and has a Zacks ETF Rank #1 (Strong Buy) with a High risk outlook (read: Top-Ranked Technology ETFs Soaring to All-Time Highs).
Invesco BuyBack Achievers ETF (PKW - Free Report)
This ETF follows the NASDAQ US BuyBack Achievers Index, which comprises U.S. 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 246 stocks with Oracle taking the fourth position at 4.7% allocation. PKW has accumulated $701.8 million in its asset base and trades in average daily volume of 124,000 shares. It charges 62 bps in annual fees.
First Trust Cloud Computing ETF (SKYY - Free Report)
This fund provides exposure to cloud-computing securities by tracking the ISE Cloud Computing Index. Holding about 65 stocks in the basket, Oracle takes the fifth spot at 3.9% of the assets. The product has been able to manage $4.1 billion in its asset base while seeing a good volume of about 545,000 shares a day. It has 0.60% in expense ratio and a Zacks ETF Rank #2 (Buy) with a Medium risk outlook.
First Trust NASDAQ Technology Dividend Index Fund (TDIV - Free Report)
This fund provides exposure to the dividend payers in the technology sector by tracking the Nasdaq Technology Dividend Index. The product has amassed about $1.2 billion in its asset base and trades in moderate volume of about 157,000 shares per day. The ETF charges 50 bps in annual fees and holds about 89 securities in its basket. Of these firms, ORCL occupies the eighth position, making up roughly 4.1% of the assets (read: A Quick Guide to Dividend Aristocrat ETFs).
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