NEW YORK (Reuters) - Oracle Corp. (ORCL.O), the world's No. 2 software maker, has hired one of its biggest fans on Wall Street as a top executive to work side-by-side with Chief Executive Larry Ellison.

Charles Phillips, a star analyst at Morgan Stanley (MWD.N), will become executive vice president of Oracle.

The move comes less than a month after Wall Street's leading brokerages agreed to pay a total of $1.4 billion to settle allegations about conflicts of interest between analysts and the companies they follow.

Phillips -- who, as an analyst, hosted Oracle executives for dinner in his Manhattan home and called Oracle one of the "most well-positioned software companies in the world" -- has analyzed the enterprise software industry since 1986.

For a decade, he was extremely bullish on Oracle's stock, even at times when the stock price was falling and Ellison was under attack from investors for cashing out Oracle options.

Among the 13 software companies Phillips covered, Oracle was one of only two that he rated "overweight," or "buy." The other one was J.D. Edwards & Co. (JDEC.O).

Phillips cooled on Oracle for one month, in March 2001, when he cut his rating to "neutral" after the technology bubble burst. A month later, he raised the rating back up to "outperform," or "buy."

While Oracle's stock has fallen from its split-adjusted highs around $45 in September 2000, it has outperformed many of its peers. In the last year the stock has gained 32 percent.

At Oracle, Phillips' responsibilities will include corporate strategy and business development. He will be one of three executives, including Ellison, in Oracle's office of the chief executive. He will also be a member of the executive management committee.

AN UNUSUAL APPOINTMENT

The appointment of a Wall Street analyst as a top corporate executive is unusual, if only because of the professional distance analysts are expected to keep from the companies they cover.

"If he has consistently been positive about Oracle and then he decides to work for them -- putting his human capital behind the company -- it seems to me like he believes in his views of the company," said Espen Eckbo, professor of finance and director of the Center for Corporate Governance at the Tuck School of Business at Dartmouth College in New Hampshire.

"You couldn't get a better signal of his opinion of Oracle than that," Eckbo added.

Some analysts, who asked not to be identified, said Phillips' position at Oracle could be a stepping stone to a senior role at an investment fund or research division.

Phillips joined Morgan Stanley in 1994 and has been named the top enterprise software analyst every year since then by Institutional Investor magazine. He has also been named one of the top 50 black professionals on Wall Street by Black Enterprise magazine. He has a undergraduate degree in computer science.

Phillips' reputation apparently impressed Oracle. In an interview with InformationWeek magazine in August 2000, Oracle Chief Financial Officer Jeff Henley said of the analyst, "His reputation is well deserved. He's a very intense, thorough researcher."

Reached by telephone, Phillips declined to answer questions about his move to Oracle without a Morgan Stanley public relations officer on the line.

Dennis Shea, Global head of Morgan Stanley's equity research, said, "Chuck Phillips set the standard for deep insight and proprietary work in his sector. We wish him well."