Oracle Financial Data (SEC filing vs research report)

[Josef Auboeck]

Hi,

I just compared the research report on Oracle (Exhibit 8) from Morgan Stanley with the financial statements on the SEC website.

Does anybody have an explanation why operating income and EPS are not the same?

For 2011 the report says $15.9 (2010: 12.5) mio operating income vs. $12 (2010: $9) million in the 10k. Same is true for EPS, it's significantly higher in the research report.

Not sure which numbers are correct and what I am missing.

Josef

[mariana silva]

My guess is that the difference is due to discrepancies in GAAP and non-GAAP accounting.  Any other thoughts?

[Andrew Hamilton]

Could be the result of a few different things:

1) Analyst used a 10-K (or Q) that was subsequently amended. If you
pull up another SEC filing, the numbers may match.

2) Many companies provide "adjusted" EPS numbers in the press release
that accompanies the filing of their quarterly and annual financials
(usually makes their numbers look better). Basically they strip out
what they claim are unusual /non-recurring/one-time items. The
Analyst might be using numbers that more closely match those from
Oracle's press release.

3) Similar to point 2, The Analyst might have his model set up in such
a way that he populates it with only the recurring revenue and expense
items and leaves out random accounting noise. Basically he is
providing what he sees as "real" EPS.

Andrew

[Mohamed Shommo]

Hi Joesf,
The Morgan Stanely report was issued on February before Oracle released its 10k. Some of the 10Qs, of course, are built on quarterly estimation of allocated revenues and expenses. The picture does not get clear until the allocations actually take place. So discrepancies are bound to happen ( even between the summation of the 10Qs and the actual 10K). In addition to that, analysts care more about the non-gap performance and so does companies. I would go with what the analyst report says.

Thanks,
Mohamed