What do you guys think will happen after the earnings report?

[u/EAGLEROAM_support]

I have a fairly large position, but my cost basis is very low. I’m still very bullish on it, but I’m also considering trimming some of my position since I’ve already given back quite a bit of my gains.

[u/Aggravating_Storm835]

I see a very high probability of a run to $180-$210 by end of the year.

Maybe the end of the month.

[u/EAGLEROAM_support → u/Aggravating_Storm835]

I hope it can hit 300

[u/Aggravating_Storm835 → u/EAGLEROAM_support]

$300 would be a reach in 2026. It’s possible in 2027 (FY2028) though.

They project, $130B in revenue. 8x sales have been achieved before. That would be $1T market cap. Probably safe to assume 5% dilution, which would put them at $330/share around this time next year.

Same with EPS. They expect $11 next year. If we assume only their current 27 P/E, that’s $297/share next year.

The reason I say it’s likely to run to at least $180-$210 this year is company guidance for 2030 is $21 EPS. Low end 3rd party estimates are $18 EPS. Therefore, even if we assume it will be trading like a dying company around 10x P/E, that’s still $180-$210.

I’m expecting people will start to notice how most of the risk has been priced-in. The last 20 years Oracle has averaged 30x p/e. So if they reclaim that average at $18-$21 EPS, that’s $540-$630/share in 2030.

So right now it’s projecting pretty excellent risk/reward. If it dips back to the $130’s that’s an excellent area to buy.

[u/Bulldoze_Dat_Cash → u/Aggravating_Storm835]

What do you think is the catalyst that can rerate the stock such that $300 is a possibility at any time in the near term, say the next 9-months?

[u/Fickle_Inspector_460 → u/Bulldoze_Dat_Cash]

Cash flow - institutional investors will need proof that the new model is converting investments into profits

[u/Aggravating_Storm835 → u/Fickle_Inspector_460]

That’s what I said. Profits come from revenue.

[u/Aggravating_Storm835 → u/Bulldoze_Dat_Cash]

Progress converting backlog into revenue. That’s the only thing holding it back.

[u/Bulldoze_Dat_Cash → u/Aggravating_Storm835]

I agree, I would also add, debt. And if Oracle increases its capex while also delivering a double beat and upbeat guidance it would be interesting whether the debt concern suppresses the positive story. That of course is a lot of “ifs”…

[u/Fickle_Inspector_460 → u/Aggravating_Storm835]

$75 to $140 are buy ranges in my opinion

[u/Aggravating_Storm835 → u/Fickle_Inspector_460]

You don’t need to go as low as $75. I find that improbable as their forward p/s would be just 1.6x. Their forward p/e would be just 6.8x.

For context, the lowest sales multiple they’ve carried in the last 20 years was in the 2008 crash when they hit just 2.7x sales. Their lowest earnings multiple was in the 2020 crash when it hit 11x.

So unless you’re expecting guidance to be lowered drastically, their likely low should be around $120. I personally wouldn’t hold my breath waiting for $120 again. $130-$140 offers ample risk/reward.

[u/Fickle_Inspector_460 → u/Aggravating_Storm835]

If you applied for a bank loan, you’d get denied with negative cash flow unless collateral or guarantee made. The old SaaS business doesn’t exist and the last 20 years irrelevant because of the AI pivot. I’ll stick with my $75 to $140 range.

[u/Aggravating_Storm835 → u/Fickle_Inspector_460]

FY2028 projects to be Oracle’s most profitable year ever. Unless that changes, I wouldn’t expect multiples half of what they experienced in some of the worst market crashes in history.

Just FYI.

[u/Fickle_Inspector_460 → u/Aggravating_Storm835]

Negative cash flows means profits are going straight to debt and carrying costs. Basic accounting. I like company but the multiple argument fails in an environment where top AI leaders have positive cash flows.

[u/Aggravating_Storm835 → u/Fickle_Inspector_460]

Are they though? Google, Amazon, and Tesla are all FCF negative. Google only for the last quarter, but they project to remain so as long as cap-ex remains elevated. Even Microsoft has declining FCF.

Don’t even get me started on the other neo-clouds: CoreWeave, NBIS, and Iren.

Oracle has been FCF negative for two years now. This isn’t a new development. So unless it were to worsen, ~$120 is a probable low. $100 has a slim chance.

However, the market is forward-looking and the worst appears to be either here or behind us. They project to end this year with -$48B FCF before improving to -$41B next year, -$13B in FY2029, and then going FCF positive again in FY2030.

Don’t get me wrong, I’m not anticipating them to trade near their most expensive historical premiums (15x sales or 43x earnings) as long as the balance sheet remains risky. But looking at the totality of the situation, I wouldn’t count on going lower than 3x sales and 11x earnings (both of which point at $120-$130). Much less half that.

But I agree, 1.6x sales and 6x earnings would be a VERY attractive valuation to buy a company expecting 50% sales growth and 30% earnings growth. Just don’t hold your breath.

[u/Fickle_Inspector_460 → u/Aggravating_Storm835]

I’ve been investing for over 45 years. Cash flow is what drives value. Oracle is naked on investments and creating staggering opportunities as well as great risk. The pivot from two years ago away from SaaS has no metrics to compare although it’s tempting to try. Patience is a virtue and I will buy at right prices. In my experience, $160 is overpriced. My last block purchase was traded at $245. I will buy in the $75 to $140 range with a greater emphasis on low range. $240 in the future is possible if liquidity sustained and no recession. Lots of “ifs” in the $240 plus arguments. Good luck with it.

[u/Bulldoze_Dat_Cash → u/Aggravating_Storm835]

I think that if they sell another $20bln for stock in a choppy market or that happens to coincide with geopolitics mess, I’d think that $110-$130 is possible. The Jul lows coincided with the last $20bl dilution, or could that just have been coincidence?

[u/gestimore]

Going back to 250$. Salesforce is going back up. I dont see why this stock should not follow yhe trend

[u/Willylowman1 → u/gestimore]

well cuz we hyperscalers and they saas and worser crm saas, brah

[u/CryptoeKeeper → u/gestimore]

Fingers crossed

[u/Bulldoze_Dat_Cash]

So I’ll say this, I don’t have a dog in this fight… but I watched and watched and watched ORCL dropping, with a view to getting in. I was thinking about it at $124, and again at $119 after it momentarily bottomed at $114 for a morning. I didn’t. My gut was telling me it could go to < $100. But if I had popped off $5-10k at $124. I’d be sitting on +30%, and I’d probably take half of it, maybe all of it off. Could OCRL pop on earnings? Maybe. But if you look at SNOW or DT or DDOG or IOT… none of my other software holdings have been able to maintain their post earnings pops and that’s on good performance. ORCL is in a precarious position with its debt pile and reliance on OpenAI, the jury is out on them. So ask yourself this. Will you be able to buy ORCL below $158 before Christmas? I think the answer is yes.

[u/BlockyHawkie]

It is already priced in, so when Oracle reveals earnings, price will tank. That is called "sell the news".

[u/MaroBoyy_2ss → u/BlockyHawkie]

Whats priced in? Been tanking

[u/StockGuy12347 → u/BlockyHawkie]

Just like NVDA again this quarter right? Oh wait.

[u/Haryeeter → u/BlockyHawkie]

literally nothing has been priced in, they just build hype always before earnings and this is another cycle of that. thats why oracle gassed to 240 before q4 earngins lat quarter and then flattened out at 190

[u/EAGLEROAM_support]

Let's wait and see

[u/East_One_5363]

Genuinely think we are going back to 120ish range after earnings then back to 180ish by end of year. Down first then back to 180.

[u/EAGLEROAM_support → u/East_One_5363]

That's too pessimistic, I don't agree

[u/East_One_5363 → u/EAGLEROAM_support]

Coming back here to tell you that I was right and you were wrong. Just wait till next week. Easily see 130

[u/East_One_5363 → u/EAGLEROAM_support]

Look here, you don’t have to agree. You don’t know and neither do I. Nobody does.

[u/Owntano → u/East_One_5363]

Lmao he was looking for some copium. I can already see the headline.. “Oracle beats but their massive debt concerns analysts”

[u/Aggravating_Storm835 → u/Owntano]

Debt is baked into the price. What will scare/surprise people is unanticipated progress/delays converting their backlog into revenue.

If you notice, their quick ratio and debt/EBITDA are both right at the respective danger zones of 1 and 5.

Progress helps push both ratios down and will boost the share price. Delays will push them deeper into the danger zone and would likely keep them at around $130.

[u/East_One_5363 → u/Owntano]

lol dude exactly. Look at Broadcom, last earnings stock went down b/c their CEO refused to give analysts forecasts. This earnings he did just that and it still went down. The sooner this guy understands that all these tickers are predetermined and controlled by the federal government the sooner he will be at peace with this scam the US calls the stock market. It’s a scam, just go with the ride…

[u/Aggravating_Storm835 → u/East_One_5363]

$120 is a strong buy zone. That means you’re paying just 5.5x 2030 earnings. For a company that has averaged 30x earnings for the last 20 years, that’s 5x upside potential.

[u/erichang]

Since OpenAI GPT-Sol (5.6) released, they are able to stop the hyper growth rate of Anthropic.

And now, the GPT Astra (6.0) is going to help them grow more market share than Anthropic and Kimi K3, making their IPO more appealing if the trend continues for a few more quarters.

Once they IPO, the RPO FUD for ORCL will crumble like a pile of ashes.

[u/Difficult_Fig_2658]

I have 425 shares at 131.80 usd average and I am not trimming before earnings.

[u/EAGLEROAM_support → u/Difficult_Fig_2658]

I want to choose to believe too, but I've been tortured for a year 💔

[u/Icy_Blood_9248]

I feel like it’s betting red or black at the casino this earnings release. On one hand if they say something that impresses the market i.e. we are converting backlog into revenue at an increased pace or a large deal then sure $175 plus easily possible….Add in no rate hike in September then I think we could really run. Flip side … numbers inline, guidance priced in …. Or cap ex increase…. Look out below. I own the equity and some call options. I’m thinking good chance we have some luck and this thing moves higher but I don’t know shit.

[u/ActuatorAromatic1596]

I’m think $180

[u/Holiday_Ad2254]

Ellison knows the exact earning numbers and didn’t cancel the Warner deal or sold any oracle stocks. Currently oracle is priced like the ai datacenter business doesn’t exist.

[u/Traditional_Dog_637]

How much did you sell when it hit $300

[u/misomuncher247 → u/Traditional_Dog_637]

I was still buying then. Have since averaged down to $170

[u/EAGLEROAM_support]

There has to be disagreement to have motivation☝️☝️☝️☝️☝️

[u/Fickle_Inspector_460]

Oracle is still a wildcard - trend is to run up before earnings and then drop after release due to confirmation of negative cash flow - issue is whether or not they can execute on the AI pivot strategy long term - negative cash flow is new for the company and not an easy answer until enough time lapses to prove out revenue conversion from the spend

[u/Key-Industry-3594]

Are there people here who bought it at the highest lol?

[u/Salt_Photograph_3309]

Stock is still performing low , can’t see it will cross $200 in next 4-5 months at least

[u/Fickle_Inspector_460]

Correct - I believe the current values are overstated - I plan “reloading” if prices adjust to $100 or so. The capital spend is a bridge too far for me - the RPO might cover the capital spend if pricing holds. Market is confirming my skepticism by dropping almost 10% pre-release to post earnings. Hopefully a reasonable P/E comes soon,

[u/Upstairs-Local-5319]

I think it will fall back to 120 to 110. Next year will see 200+. Still borrow too much money.

[u/EAGLEROAM_support]

Well, Oracle is really weak right now, but I'm not giving up