STOCKREPORTS

Oracle Corporation

Nasdaq Symbol ORCL In S&P 500

Recent Price 50.38 52 Wk Range 52.00 - 35.25

Yield Nil 12-Mo. P/E 41.3

Quantitative Evaluation: Outlook (1 Lowest - 5 Highest) 5 Fair Value 67.80 Risk MEDIUM Earn/Div Rank B
Technical Evaluation: BULLISH since 05/97 Rel. Strength Rank (1 Lowest - 99 Highest) 78 Insider Activity Neutral

Overview 18-MAR-97

Revenues should increase approximately 35% through FY 98 (May), reflecting strong demand for the company's relational database management system, robust sales of application products, continuing demand for services, and expansion of worldwide economies. Products for the UNIX and desktop environments (which account for about 90% of total revenues) should continue to grow rapidly. The availability of new products, including the expected June 1997 shipment of Oracle 8, a major upgrade to the company's flagship database program, bodes well. Margins are expected to be maintained in the FY 97 fourth quarter, as higher volume and expense controls are offset by a higher tax rate. However, margins should widen in FY 98, on a reduction of the tax rate along with continued volume efficiencies and cost controls. Comparisons in FY 98 should benefit from the greater revenues, wider margins, and absence of a nonrecurring acquisition charge of $0.04 a share in the FY 97 third quarter.

Valuation 18-MAR-97

Operating earnings should remain strong through FY 98. The database software segment is growing rapidly, as organizations cope with managing and utilizing the massive data stored on their computer systems. ORCL's leadership position bodes well for future results. The core database server business is strong, applications software revenues should grow rapidly, and there is a continuing need for additional services. The shares, which have fallen from their December 1996 highs, were recently trading at a P/E about equal to 75% of the projected growth rate over the next several years, based on calendar 1997 estimates. The strong earnings growth that we expect should help the stock outperform the market in coming months.

Key Stock Statistics

Fiscal Year Ending May 31

Dividend Data: No cash dividends have been paid. A three-for-two stock split was effected in February 1995. A "poison pill" stock purchase rights plan was adopted in 1990.

Business Summary 08-OCT-96

Oracle Corporation develops, markets and supports computer software products used for database management, network communications, applications development and end-user applications. Its principal product is the ORACLE relational database management system (DBMS). The company offers its products, along with consulting, education, support and systems integration services, worldwide.

Database management systems software permits multiple users and applications to access data concurrently while protecting the data against user and program errors and against computer and network failures. Database management systems are used to support the data access and data management requirements of transaction processing and decision support systems. The ORACLE relational DBMS runs on a broad range of massively parallel, clustered, symmetrical multiprocessing, minicomputers, workstations and personal computers using the industry standard SQL language.

A variety of applications development products, sold as add-ons to the ORACLE relational DBMS, increase programmer productivity and allow non-programmers to design, develop and maintain their own programs. Access tools enable end users and decision support analysts to perform rapid querying, reporting and analysis of stored data.

The company also offers an integrated family of end-user financial applications, including general ledger, purchasing, payables, assets, receivables and revenue accounting programs, as well as manufacturing and human resource applications. These application products use the ORACLE relational DBMS and related development and decision support tools.

ORCL offers consulting, education and systems integration services to assist customers in the design and development of applications based on company products.

Important Developments

Mar. '97 Total revenues in the third quarter of FY 97 (May) grew 35%, year to year; core database license revenues rose 32%, applications rose 61%, tools declined 9% and services advanced 41%.
Mar. '97 In the third quarter of FY 97. the company recorded a $36.8 million ($0.04 a share) charge for the writeoff of in-process research and development associated with its acqusition (for $81 million in cash) of the remaining shares of 13%-owned Datalogix, a vendor of process manufacturing applications.

Capitalization

Long Term Debt: $300,950,000 (2/97).

Curr. Ratio	NA	1.6	1.5	1.6	1.5	1.6	1.2	2.0	1.9	1.9
% LT Debt of Cap.	NA	1.0	6.2	9.6	13.9	17.7	4.9	17.9	12.1	3.6
% Net Inc.of Revs.	NA	14.3	14.9	14.2	9.4	5.2	NM	12.1	14.0	15.2
% Ret. on Assets	NA	20.9	22.0	20.4	13.2	6.7	NM	18.6	22.6	21.5
% Ret. on Equity	NA	39.1	45.2	44.6	29.2	15.6	NM	37.5	43.9	38.8

Data as orig. reptd.; bef. results of disc. opers. and/or spec. items. Per share data adj. for stk. divs. as of ex-div. date. E-Estimated. NA-Not Available. NM-Not Meaningful. NR-Not Ranked.

Office--500 Oracle Parkway, Redwood Shores, CA 94065. Reincorporated--in Delaware in 1987. Tel--(415) 506-7000. E-mail--investor@oracle.com Website--http://www.oracle.com Chrmn, Pres & CEO--L. J. Ellison. EVP & CFO--J. O. Henley. SVP & Secy--R. L. Ocampo, Jr. Investor Contact--Catherine Buan. Dirs--M. J. Boskin, L. J. Ellison, J. O. Henley, R. J. Lane, D. L. Lucas, D. W. Yocam. Transfer Agent & Registrar--Harris Trust & Savings Bank, Chicago. Empl-- 28,844. S&P Analyst: Peter C. Wood, CFA

This report is for information purposes and should not be considered a solicitation to buy or sell any security. Neither S&P nor any other party guarantee its accuracy or make warranties regarding results from its usage. Redistribution is prohibited without written permission. Copyright © 1997