Oracle (NASDAQ:ORCL) Strongly Positioned for Cyclical Upturn

Oracle (NASDAQ:ORCL) is positioned strongly for what appears to be a cyclical upturn in the sector, and enterprise software spending should result in a major benefit to the company.

Barclays (NYSE:BCS) stated, "In front of 2Q results tomorrow, we reiterate our 1-Overweight rating on our 2011 top pick. In our view, Oracle remains exceptionally well-positioned to benefit from a cyclical upturn in enterprise software spending with multiple product cycles such as Exadata, Exalogic and beginning in 1QC11 Fusion Applications, providing upside drivers to new license and product sales, margins and market share gains over the next several quarters.

"With enterprise spending firming and checks pointing to solid trends across technology and applications, we expect Oracle to post 2QFY11 results toward the high end of its outlook. We forecast license sales of $1.87 billion (+13% y/y, versus guidance of 6% to 16%), hardware sales of $1.15 billion, versus guidance of $1.1 billion to $1.2 billion) and EPS of $0.46 (versus guidance for $0.44 to $0.46).

"Regarding the 3Q outlook, we expect Oracle to maintain its usual optimism, citing market share gains, execution and new product cycles such as Exadata as positive drivers, given channel commentary for healthy pipeline builds. We currently forecast 3QFY11 revenue of $8.4 billion, license growth of 11%, hardware revenue of $1.13 billion and EPS of $0.47."

Barclays maintains an "Overweight" rating on Oracle, which closed Wednesday at $30.49, down $0.02, or 0.07 percent. They have a price target of $34 on them.