Picking and Choosing In Tech

Q: Oracle (ORCL ) -- buy, sell, hold?A: Oracle is presently a 3-STAR (hold), as followed by my colleague Jon Rudy. The company has been in the news lately for its offer to buy PeopleSoft (PSFT ) for cash. This is an aggressive attempt to capture PeopleSoft's customer base, we think, rather than PeopleSoft's technology.

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It's not clear how this skirmish will play out, because PeopleSoft was already in the middle of efforts to acquire JD Edwards (JDEC ). It's true that Oracle's ROE looks attractive compared to most companies, as do its operating margins in excess of 30%. The company has over $6 billion in cash and investments, and little debt.Oracle is clearly a big survivor through this downturn, although we prefer other names in