MidnightTrader Earnings Play: ORCL

Oracle (ORCL | Quote | Chart | News | PowerRating) is due with its Q4 results after the close tonight, and analysts polled by Thomson Financial expect the company to report a profit of $0.44 per share on revenue of $6.8 billion.

Oracle is one to watch for its evening performance, as the stock has only recently diverged from a solid share price widening trend. ORCL favors a session-to-session widening pattern in tracking next-day trade that follows extended-hours earnings events. As a result, the stock has seen more aggressive next-day regular session trade on the heels of 11 of its last 17 after-hours earnings reports. In the near-term, the stock is putting up a slightly more mixed performance; it narrowed its move in the most recent quarter after nearly matching its share move a quarter earlier, all that following three straight widening moves in preceding quarters.

On March 26, 2008, the stock fell 8.5% after ORCL reports a revenue miss. The loss was trimmed slightly, to 7.2% the next day.

On Dec. 19, 2007, the stock gained 6.5% during evening hours after ORCL reported in line with Q2 and guides for Q3 in line to above the Street view. The stock gained 6.4% the next day.

On Sept. 20, 2007, ORCL firmed 0.1% in evening activity after beating Q1 estimates and forecasting Q2 non-GAAP EPS to be in line to above expectations. Shares built on those gains and ended the next day session up 4.4%.

On June 26, 2007, the stock was up 1.1% after guiding higher. The gain improved to 2.7% the next day.

On March 20, 2007, ORCL edged up 2.8% in after hours when the company topped Q3 EPS estimates by $0.02. Shares rose further the next day, ending the regular session up 3.5%.

Brooks McFeely is widely regarded as the leading expert on extended-hours trading. He is a Managing Partner for Brochet Capital Partners, LP and the founder of Midnight Trader, Inc. (www.midnighttrader.com), the leading provider of pre-market and after-hours trading analysis and news to retail and institutional investors.