Oracle, Inc. (ORCL) HAS BEEN a perennial heartbreaker traditionally with its response to earnings.
Typically, Oracle’s breakouts fail. I thought the odds were tilted toward its breakout stalling and failing again earlier this morning. I was wrong.
My thinking was simple. ORCL had run from $125 to $175 into the print and also had TWO big gap-downs to contend with: one from the DeepSeek news in January, and the other, an earnings gap-down in December.
My Algo Volume Alert triggered 10 minutes ago. ORCL volume has already done a 5x-er relative to ADV! That is unheard of for a large cap name like Oracle, particularly on a summer Thursday.
Oracle's has a new business model. It utilizes the inherent scalability of its database software to build high-performance computing clusters, in the form of AI Factories, which then get leased to big cloud players like Microsoft. This new model is very scalable and very profitable for the company.
This is why we are seeing the rabid accumulation in the stock this morning. Take a look:
ORCL is currently tracking to do 55-60M shares on the day. While some near-term stalling into June expiration at $200 is likely, I think $210-$215 is coming over the next two weeks. I think we see $250 by Thanksgiving, if not sooner.
RPO growth is expected to be up 100% this new fiscal year. That is crazy. That is almost $250B of booked forward business. Its growth rate in revenues and big earnings growth will manifest strongly the next few years as a result.
Of course, I could be wrong.
But with my algo-formula kicking in, ORCL at all-time highs, and the big getting bigger and stronger in AI, I think the odds of this playing out are 75%.
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Disclosure: We are long ORCL stock and calls. We may change our positioning at a moment’s notice, without notifying you of any such moves.
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