Cautious Stance on Oracle Due to Valuation Convergence
"Now I'm going to talk about Oracle and why this is my third favorite out of the three and why I'm personally not buying much of this one if any. Oracle historically traded at very low valuations, but now, with valuations converging with higher-flying stocks like Microsoft, the mispricing is gone. I still own some Oracle, but it's not the one I'm most excited about. I would only consider a more aggressive buying approach if the stock drops below 260, which would signal a better risk-to-reward scenario."
The speaker explains his cautious outlook on Oracle, noting that although Oracle still has growth opportunities in the AI infrastructure market, its valuation no longer provides the mispricing advantage seen previously. He suggests a very conservative, small dollar cost averaging approach, only considering additional positions if the stock dips below 260.
Negative Sentiment on Oracle's Open AI Deal
"Oracle here uh was down roughly 4.5 4.8% almost 5%. The main reason we did get in over the weekend and today some analysts may be not being as bullish anymore on the open AI deal due to the amount of debt. This company needs to raise the amount of risk of having the concentration on just open AI and it's creating this negative sentiment towards the AI infrastructure players."
The speaker conveys a bearish outlook on Oracle, citing concerns over an open AI deal burdened by significant debt and a risky concentration in open AI. This commentary suggests that the negative sentiment around Oracle could persist in the short term.
Oracle's Exponential Growth Guidance in AI Infrastructure
"Oracle shared its AI infrastructure delivery example by outlining a road map where Oracle Cloud revenue should grow from $10 billion in fiscal 2025 to $166 billion in fiscal 2030. They broke down costs into 35% for land, data center, and power, and 65% for compute, network, and storage. The numbers are described as insane, and if Oracle can pull these targets off, the stock would be extremely cheap today. However, failure to meet these numbers could result in a significant variance against consensus."
Speakers examine Oracle's ambitious guidance for its cloud revenue growth fueled by AI infrastructure, emphasizing the potential upside if targets are met while cautioning about the risks if there are execution missteps. The detailed cost breakdown and multi-year roadmap provide investor clarity on long-term valuation.
Oracle Stock Rated as a Buy with Early Entry Advantage
"Of course, I"m happy about Oracle success. I"ve had Oracle stock rated as a buy all year long and I identified this stock early on when no one else was talking about Oracle. I rated Oracle in fact as one of the best stocks to buy this year in 2025 and I made that recommendation around January. I took it, I since took it off my list of best stocks to buy roughly a month ago after the stock price had increased by so much already. I downgraded it from one of the best stocks to buy and I kept it rated as a buy and still the company has performed extremely well and I"m happy about its success and I"m happy for all of you that I"ve made money on Oracle stock."
The speaker highlights his long-standing conviction in Oracle, rating it as a buy and one of the best stocks for 2025. He emphasizes that he entered early before widespread attention, later removing it from his top list after significant price appreciation, yet maintaining a buy rating due to strong performance.
Oracle Downgraded Outlook Amid Falling Shares
"Also want to talk about one of the more important stocks in the world and that is Oracle falling the most since January 27th down almost 7%. This is again a top 10 company uh depending how you want to look at it falling after suggesting that investors anticipate a smaller boost from AI infrastructure spending. This is a company that's partnered with Open AI, Meta, Elon Musk's XAI, so dialing back their long range financial outlook."
The speaker remarks on Oracle's significant drop of nearly 7% and its lowered expectations for AI infrastructure spending, which could be viewed as a cautionary note for investors. The commentary points to potential headwinds for Oracle despite its strong market position, providing an investor signal to possibly exercise caution.
Oracle Shows Robust Cloud Outlook amid Bubble Concerns
"Oracle is giving its strong cloud infrastructure outlook from a dozen billion they will make 150. Wow. So huge growth. Just the bookings on their cloud deals plus 300 billion because OpenAI said we'll spend 300 billion with you. They made 12 billion this year. So huge projections."
The speaker highlights Oracle's bullish cloud business with impressive revenue projections and growth catalysts, though it is mentioned within the broader context of a potential bubble. The emphasis is on Oracle's strong cloud bookings and the massive spending commitment by OpenAI, suggesting robust near-term growth despite overall market exuberance.
S&P 500 Overconcentration in AI Stocks Raises Diversification Concerns
"But right now, the S&P is being taken over. It's being dominated by a handful of massive tech companies that are all racing to win the AI game. Apple, Microsoft, Nvidia, Alphabet, Amazon, Meta, Tesla, Broadcom, Oracle, all of these companies are fighting for AI. These companies have gotten so big so fast that they now control a huge chunk of the index. In fact, guys, the tech sector now makes up over 35% of the whole S&P. So ask yourself this question. If your portfolio depends on nine companies all swimming in the same AI pool, is that really a safe and balanced investment?"
The speaker warns that the S&P 500 is becoming dangerously overconcentrated in a few massive tech companies focused on AI. He emphasizes that this overconcentration creates diversification risks, and if a few of these stocks falter, the entire index could be adversely affected.
Avoiding Oracle Due to Revenue Concentration Risk
"Then we have Oracle, which is a genuine hyperscaler cloud computing company. And there's a reason that I don't own Oracle. Keep in mind that Oracle's customer count is only 200,000 with about 80% of their revenue coming from OpenAI. That's promised revenue. It doesn't mean it will for sure happen. This dependency makes Oracle a higher risk compared to companies with a diversified customer base."
The speaker explains his decision to steer clear of Oracle, pointing out that its heavy reliance on OpenAI for 80% of its revenue introduces significant risk. In his view, the lack of customer diversification makes Oracle a less attractive and riskier investment relative to other hyperscalers.
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Oracle Trade Call
"I bought Oracle before earnings because we see these deals happening, whether it's through our data or some other means."
The speaker explicitly reveals a buy action on Oracle ahead of earnings, citing the scale of OpenAI deals as a catalyst. This trade call suggests a bullish view on Oracle benefiting from mega data center contracts and related capex spending.
Technical Spike in Oracle Triggers Profit-Taking Call
"Oracle shares are up 40% in one day, intraday right now. And the power gauge gave what we call a relative strength buy signal on Oracle two days ago. ... in our trading-oriented newsletter we’re recommending that people take some profits because the spike has dragged along a lot of tech stocks."
The hosts highlight that Oracle (assumed ticker ORCL) recently experienced a dramatic intraday spike and, despite a relative strength buy signal from the power gauge two days earlier, technicals now suggest it may be time to take profits. This trade call is aimed at short-term traders looking to lock in gains.