The Zacks Analyst Blog Highlights:Oracle, Microsoft, IBM, BioDelivery Sciences International and Endo

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Mar 19, 2014, 09:30 ET

CHICAGO, March 19, 2014 /PRNewswire/ -- Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include the Oracle Corp. (NYSE:ORCL-Free Report), Microsoft (Nasdaq:MSFT-Free Report),IBM (NYSE:IBM-Free Report), BioDelivery Sciences International, Inc. (Nasdaq:BDSI-Free Report) and Endo (Nasdaq:ENDP-Free Report).

Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.

Here are highlights from Tuesday's Analyst Blog:

Oracle Misses on High Expectations

Legacy tech giant Oracle Corp. (NYSE:ORCL-Free Report) reported fiscal 3rd quarter 2014 earnings after the bell Tuesday, and after having traded a few weeks at levels not seen since the early 2000s, missed on both top and bottom lines. Oracle reported earnings per share (EPS) of 64 cents (accounting for stock-based compensation) on revenues of $9.3 billion in the quarter.

Neither headline number was a huge miss, but as expectations had been growing that Oracle's strategy of acquiring cloud-based startups on its software side and pent-up demand would start to see enterprises buying more Oracle product on the hardware side, investors had tended to look at CEO Larry Ellison's company with rose-tinted glasses. And hardware's 8% improvement in revenues was better than expected, though software licenses and cloud subscriptions were up only 4%, below estimates.

As a result, after regular-day trading gains of about 1.7%, ORCL shares have tumbled 5%. It's safe to say those rose-colored glasses have now come off.

Not that Oracle is showing many signs of changing strategy anytime soon: at the tail end of its Q3 (ended February) Oracle purchased cloud-based big data firm BlueKai, merely the latest in a string of smaller acquisitions made by the company. Of course, on the hardware side Oracle had purchased Sun Microsystems, but that was now four years ago.

Oracle currently has a Zacks Rank #4 (Sell). With no dividend hike depicted in the initial Q3 earnings announcement and plenty of competition from Microsoft (Nasdaq:MSFT-Free Report),IBM (NYSE:IBM-Free Report), etc., it would appear there is little to sustain its share price at or near 52-week highs, at least for the time being. That said, Oracle is not particularly expensive at 12x forward earnings, it does seem to be staying competitive in the cloud space, and sooner or later enterprises are going to start buying hardware again.

Depending on what analysts' outlooks are going forward, this may be an interesting time to keep an eye on ORCL stock.

Pipeline Update from BioDelivery Systems

Updates on future business plans of a company and regular reviews on its achievements during a particular period of time are highly awaited events in the pharma/biotech sector as they play an important role in deciding whether or not to invest in a particular company.

These updates provide information on the pipeline, include news on filing of marketing applications, their acceptance by regulatory agencies and at times give an insight into the commercial potential of the candidate once it is successfully developed and commercialized.

Late last week, BioDelivery Sciences International, Inc. (Nasdaq:BDSI-Free Report) provided an update on its business operations and pipeline.

BioDelivery Sciences provided updates on two of its lead candidates containing buprenorphine for opioid dependence and pain management, respectively. The company confirmed that the U.S. Food and Drug Administration (FDA) will provide a response on Bunavail's approval status, for the maintenance treatment of opioid dependence by Jun 7. If approved, BioDelivery Sciences expects to launch Bunavail in the third quarter of 2014.

Meanwhile, BioDelivery Sciences and partner Endo (Nasdaq:ENDP-Free Report) are conducting a phase III study on BEMA buprenorphine in opioid experienced patients. Top-line results from this study should be out by mid-2014. BioDelivery Sciences intends to file a new drug application (NDA) for BEMA buprenorphine later this year or early next year.

BioDelivery Sciences also intends to initiate two phase III studies on clonidine topical gel, licensed from Arcion Therapeutics in 2013, for the treatment of painful diabetic neuropathy. The company said that it will start enrolling patients for the first phase III study shortly. Interim data from the study should be out by the end of 2014. Having a fast-track designation, clonidine might be granted priority review by the FDA. The company intends to file an NDA for clonidine in 2016.

We expect investor focus to remain on Bunavail's approval status.

BioDelivery Sciences carries a Zacks Rank #3 (Hold).

Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.

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