MENLO PARK, Calif. (CNN/Money) -
It's clearly good to be Larry Ellison, the showman-billionaire who also happens to run a large software company.
It's looking good as well to be an investor in that company, Oracle, provided you like big, boring, grind-it-out-the-old-fashioned-way corporations.
Oracle reports fiscal first quarter earnings before the bell Friday morning. There are lots of reasons to believe the news will be good, though not great.
Good, not great, is consistent with Larry Ellison's theme of late.
Since earlier in the year he's been plugging the idea that Silicon Valley's hyper growth era is finished. It's no coincidence that the same is true for Oracle.
But that's not bad thing.
JMP Securities software analyst Patrick Walravens told clients earlier in the week to expect Oracle to report license revenue growth in the 7 percent, year-over-year range, a growth rate he deems "very solid."
(Licenses are the bread and butter of a company that sells software to big businesses, as opposed to lower-margin and less predictable service revenue.)
Single-digit growth would have been embarrassing for any reputable software company, including Oracle, four years ago. Not now. It's solid.
Walravens, one of the keenest and least cheerleaderish software watchers out there, sees a bunch of reasons to buy Oracle stock.
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His price target is $15, a modest (and boring?) rise of about 15 percent from where the stock is trading. Walravens thinks Oracle is doing a good job of selling into small- and medium-sized businesses, a market he believes is a leading indicator. He also has intelligence that Oracle is aggressively hiring sales professionals, a sure sign the company believes the coming quarters will be solid.
He even put a positive spin on Larry Ellison's new pay package. For the first time in four fiscal years, Oracle is paying Ellison a salary, $900,000, pending shareholder approval.
"Since it is unlikely that Ellison is running short of cash, we view the reinstatement of his salary as a signal that the business is returning to more normal activity levels," Walravens writes.
That's actually a good point. Less defensible is Oracle's hand-out to Ellison in July of nearly a million stock options, with an exercise price of $12.60.
Ellison likes to compare himself with Bill Gates, another company founder who, by the way, doesn't ever take stock options in Microsoft.
Ellison still controls 26 percent of Oracle, helped in part by his generosity to himself in the form of option grants. In 1999 he received 40 million options (a figure that reflects subsequent stock splits).
To review, invest in Oracle and you're likely to do okay. If Oracle does okay, Ellison will do fabulously well.
It's just got to be good to be him.
Elsewhere in the software world...
Walravens reported last week that Siebel Systems (SEBL: Research, Estimates), is considering offering a "hosted" software product called Siebel OnDemand.
That would be something for two reasons.
First, it would be an admission by Siebel, which has not commented on the report, that Salesforce.com is hurting Siebel's low-end sales.
Second, it would be a second go-round for Siebel, which spectacularly failed with an in-house, venture-backed startup called Sales.com during the bubble.
What goes around, comes around, apparently.
Adam Lashinsky is a senior writer for Fortune magazine. Send e-mail to Adam at lashinskysbottomline@yahoo.com.
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