Oracle and CR Bard

The market is down about 0.5% this morning but there’s some rough news for our Buy List.

Oracle‘s ($ORCL) earnings report wasn’t what I expected and it also fell short of what the company told us. That’s a very bad move on their part. Their shares are getting hacked this morning. Oracle has been as low as $25 per share this morning which is a 14% haircut.

As disappointed as I am in Oracle, I think a three-penny miss shouldn’t translate into a 400-penny sell-off. Today’s selling is very overblown but this is what you get when you mislead the Street.

The other news is for one of our new stocks for 2012, CR Bard ($BCR). In the company’s analyst call yesterday, they lowered their forecast for 2012 due to the impact of buying Lutonix:

Without the impact of Lutonix our guidance would have been 7% to 8% adjusted EPS growth. As our press release noted today’s transaction will dilute the 2012 adjusted EPS by about $0.25 or 400 basis points of growth. So our 2012 all-in guidance is for between 3% and 4% EPS growth excluding items that affect comparability. I would also note that the lack of the R&D tax credit in 2012 cost us about a point of EPS growth.

Bard should earn about $6.38 per share for 2011. So today’s news means that they should earn between $6.57 to $6.63 per share.

Posted by on December 21st, 2011 at 10:03 am


The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.

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