In February 2016, Oracle announced the acquisition of Ravello Systems, an Israel-based (ISL) (EIS) cloud computing company. It expects it to strengthen its position in the public cloud space.
Although a strong dollar can’t be considered a technology sector-specific factor, its impact is significant in the technology space where foreign countries account for about 60% of revenues.
Oracle, like its peers in the enterprise software space, including IBM (IBM) and Microsoft (MSFT), is finding it difficult to report revenue growth. Its cloud revenues grew by 36% in 2Q16.
After a number of failed attempts and unsuccessful talks, Chinese online travel companies Ctrip.com (CTRP) and Qunar Cayman Islands (QUNR) have reached a partnership agreement.
Qunar is currently net debt negative. This means that Qunar’s balance sheet has sufficient cash to pay off its debt. Cash on the balance sheet at the end of 3Q15 was $638 million.
For 4Q15, analysts are estimating that Qunar (QUNR) will have an EBITDA loss of $81 million. For 2015, EBITDA loss is estimated to be $316 million.
Qunar (QUNR) is currently trading at a forward EV-to-sales multiple of 4.2x. This is half its average valuation of 8.5x since November 2013.
In January 2016, Qunar (QUNR) management underwent a drastic change. The change seems plausible given its disagreements with Ctrip.com in the past.
Qunar Cayman Islands (QUNR) earns the highest revenue from flight reservations compared to other online travel industry majors such as Priceline (PCLN), Expedia (EXPE), and Ctrip.com (CTRP).
For 4Q15, analysts are estimating Qunar Cayman Islands’ (QUNR) revenue to grow by 106%, lower than the growth seen in the third quarter of 2015.
Qunar Cayman Islands (QUNR) is expected to report its fiscal 4Q15 earnings on March 21, 2016. Of the 12 analysts tracking Qunar, six analysts have a “buy” recommendation on the stock.
Ctrip is currently trading at a forward price-to-earnings multiple of 57.4x. Its valuation is higher than its average valuation of 34x as of January 2008.
Ctrip.com (CTRP) has been busy trying to consolidate the Chinese online travel agency (or OTA) market by buying stakes in its potential and existing rivals.
Heavy reinvestments in its business have increased CTRP’s debt burden. As a result, CTRP’s leverage ratios have also increased.
CTRP’s EBITDA margins are expected to rise to 14% in 2016 and to 21% in 2017. EBITDA growth is, however, expected to slow to 153% and 122% in 2016 and 2017.
At 41%, hotels form a significant part of Ctrip’s revenues, similar to other online travel agency players such as Priceline, Expedia, and TripAdvisor.
For 4Q15, analysts are estimating Ctrip.com’s (CTRP) revenue to grow by 41%, slightly lower than the growth seen in the last three quarters.
Of the 28 analysts tracking Ctrip.com, 23 have “buy” recommendations on the stock, four have “hold” recommendations, and one has a “sell” recommendation.
The Fresh Market (TFM) reported sales of $433 million in fiscal 3Q16 (which ended October 25, 2015), missing the consensus estimate by $3.1 million.
According to a news from Reuters on February 11, 2016, Kroger and various private equity firms are showing interest in buying The Fresh Market (TFM) and are in the second round of discussions.