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Software giant Oracle has been busy making acquisitions in the past few years to expand the different types of offerings it can sell to its customers...and give it a leg up against rivals like Microsoft, IBM and SAG.

"The way you get market share is by consolidating," says Patrick Walravens, an analyst at JMP Securities. Under the leadership of colorful CEO Larry Ellison, Oracle has already scooped up PeopleSoft and Siebel Systems and is in the process of purchasing BEA Systems, an acquisition that should help Oracle compete more effectively against IBM.

As a result of Oracle's shopping spree, the company is now a leading developer of many types of software for big businesses. Oracle customers use the company's software for everything from database management and global payroll and project billing to marketing and human resource management. Cowen and Company analyst Peter Goldmacher says the ability to offer such a comprehensive suite of software gives Oracle an advantage over competitors. He adds that Oracle has done a good job of integrating the companies it has purchased.

To that end, analysts expect that the company's profits to increase at an average of 15% per year over the next five years, a sign that the company's deal making is paying off. And Oracle still looks like a bargain, trading at just 15 times its earnings estimates for calendar 2008 (its fiscal year ends in May).



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