ORCL Commentator
Likes Received$Oracle(ORCL.US) Adults only make selections, not changes. My remarks yesterday were just to add a bit of confidence to those with the same expectations, not to change anything. Congratulations to friends who held through the earnings report, we've won a temporary victory 😬
Next, we'll see if the management says nice things during the 5 o'clock conference call. If indicators like capital expenditures and cash flow improve, the gains might double. Otherwise, it might be like Broadcom, rising first and then...
So the revolution is not yet complete, and I haven't broken even. Since we've already gambled on the earnings, we'll see it through to the end. There's no plan to reduce the position with the current level of gains.
I reduced my position in Oracle by a few dozen shares during last week's rebound, leaving 255 shares that I won't sell. My actual cost is around $175, and I plan to hold through the earnings report. Let me share my thoughts on Oracle:
At the current price of $150, it's clearly been oversold due to panic. Even completely excluding the OpenAI partnership, Oracle's database and software businesses alone can support the current price. So, with the price already this low, why avoid the earnings report?
Secondly, the debt was taken on proactively by the company, not forced upon it due to poor operations. It's fair to say that to seize the AI opportunity, Oracle made a massive, high-stakes bet. Divergence in market opinion creates opportunity; if expectations were uniform, the stock price would already be much higher. So, it comes down to whether the market chooses to believe first and see later, or see first and believe later.
Furthermore, the partnership with TikTok can not only bring significant cash flow and cloud business growth to Oracle but also enhance its political influence and risk resilience. Add to that Ellison's personal connection with Trump, which can be quite advantageous... Overall, the risk-reward ratio at this point is indeed very high, making it worth a bet for me.
The key points in tomorrow's earnings report will be whether the negative free cash flow narrows, the proportion of convertible RPO, and whether capital expenditure efficiency improves. Meeting any one of these could trigger a valuation recovery, and a short-term price move to $180 shouldn't be difficult.
Of course, if capital expenditure continues to rise or negative free cash flow increases again, the stock price could fall further... But the worst-case scenario is probably another dip to $130, right? I didn't sell at $130 last time, so doing it again wouldn't be a problem.
Looking at all aspects, I remain optimistic about this earnings report. This isn't about reality; it's a choice. Personal opinion, not investment advice.
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