The comments assume importance since Oracle EPS failed to meet the Street analysts' estimates in the last quarter though the preceding three quarters provided positive surprise between 1.9 percent and 5.0 percent. Therefore, the analyst is aware of the skepticism shown by investors.
In a research note, Barclays said, "Oracle started to accelerate its SaaS/PaaS revenue in Q3 FY16 and we expect further progress (75 percent YoY growth), partly helped by some of the recent smaller deals which already closed. However, even organic SaaS/PaaS growth of about 64 percent is healthy, especially as scale is increasing."
The brokerage expects the recent NetSuite deal to support Oracle, though the focus would remain on results, especially the progress on Fusion solutions. The analyst cited a VAR survey that suggested a solid first quarter.
Significantly, Barclays expects better pricing and activity in the first quarter based on its survey and pointed out early signs of customer sentiment improvement as far as Platform-as-a-Software (PaaS).
The brokerage believes the stock is still trading cheap in its coverage and expects a positive surprise to be a possible catalyst for investors to revisit their investment thesis.
At time of writing, the stock was up 1.65 percent at $40.69.
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