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No. of Recommendations: 0
Warning:  Long post ahead!


In the table below you will find my Rule Maker 
analysis for the database management king, Oracle.  I 
have decided to use Sybase, Informix, and Microsoft as 
its primary competitors.  Microsoft isn't a great 
example since Oracle only competes against a small 
portion of their product line (SQL Server), but since
we are averaging the results of the three competitors
it shouldn't throw the data off too much.  My initial
assumption was that ORCL should do pretty well, since 
most information technology shops use their RDBMS as
a corporate standard.  I was also hoping it would do
well since its stock has been beaten down as of late 
and presents a very nice buying opportunity.  

Unfortunately, the numbers don't look so good.  Take
a look for yourself:

Financial AnalysiCompany Being Evaluated                          Competitor #1   Competitor #2  Competitor #3

                  Oracle (ORCL)                                 Microsoft (MSFT) Informix (IFMX) Sybase (SYBS)
                 Current Period Year-ago PeriodYear-over-Year    Current Period  Current Period Current Period
                   99Q3 (2/99)    98Q3 (2/98)      Growth          99Q3 (3/99)    98Q4 (12/98)      12/98)
Income Statement . . .
  Sales                   2,079          1,749      18.9%                  4,331            735            867
  Cost of Goods S           792            586      35.2%                    350            191            273
  Net Income                293            215      36.3%                  1,917             58            (93)
  Shares Outstand         1,495          1,487      0.5%

Balance Sheet . . .
  Cash & Equivale         2,189          1,417      54.5%                 21,761            221            249
  Current Assets          4,337          3,334      30.1%                 24,058            432            478
  Short-term Debt             3             13     -76.9%                      0              0              0
  Current Liabili         2,278          1,803      26.3%                  7,839            404            394
  Long-term Debt            304            305      -0.2%                    980              0              0
                                                                                1              1              1
Margins & Ratios . . .                                                                                         Competitors' Average
  Gross Margins            61.9%          66.5%     -4.6                    91.9%          74.0%          68.5%     78.1%
  Net Margins              14.1%          12.3%      1.8                    44.3%           7.9%         -10.7%     13.8%
  Cash-to-Debt              7.13           4.46     59.8%                   22.21       No Debt!       No Debt!     22.68
  Net Cash                1882.0         1099.5     71.2%                 20781.0          221.0          249.0    7083.7
  Fool Flow Ratio           0.94           1.07    -11.8%                    0.29           0.52           0.58      0.47


                  Continue Here

Ranking Rule Makers

1) Brand          Points (0-1)                                  3) Financial Dire Points (0-3)
Familiarity                    0                                Sales Growth                   3
Openness                       1                                Gross Margins                  0
Optimism                       1                                Net Margins                    3
Legitimacy                     1                                Shares Outstandin              2
Inevitability                  0                                Cash-to-Debt                   2
Solitariness                   1                                Fool Flow Ratio                3
Humor                          1                                Expansion Potenti              2
  Subtotal                     5                                  Subtotal                    15

2) Financial Loca Points (0-2)                                  4) Monopoly Statu Points (0-4)
Mass Market Habit              1                                Gross Margins                  0
Gross Margins                  2                                Net Margins                    2
Net Margins                    2                                Net Cash                       0
Cash-to-Debt                   2                                Fool Flow Ratio                0
Fool Flow Ratio                2                                Convenience                    2
Your Interest                  2                                  Subtotal                     4
  Subtotal                    11
                                                                5) Your  Enjoymen              1

                   Total Score               36  Third Tier


When compared with its competitors, its debt load (even
though it is quite small) and its flow-ratio (which 
happens to be quite low) take a beating.  Its margins
are solid, but again, not as good as its competitors.
But then again, who really can compete with Microsoft?

As always, please post your comments and questions.

Fool On!

the LanceMan


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