ORCL Should I Buy
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Oracle Corp (ORCL) is not a strong buy at this moment for a beginner investor with a long-term strategy and $50,000-$100,000 available. While the company shows strong revenue and net income growth, concerns around debt, equity overhang, and AI infrastructure funding risks make it prudent to hold off on buying until these issues are resolved or the stock shows clearer upward momentum.
The MACD is positive and expanding, indicating potential bullish momentum. However, the RSI is neutral at 46.961, and the moving averages are bearish (SMA_200 > SMA_20 > SMA_5). The stock is trading below key resistance levels (R1: 167.063) and near its pivot point (153.33), suggesting limited upside in the short term.
Revenue increased by 14.22% YoY, and net income surged by 94.70% YoY in Q2
Oracle's positioning in AI infrastructure and GPU-as-a-service is seen as a long-term growth driver.
Analysts like Guggenheim consider Oracle a 'decade stock' with significant future EPS and free cash flow growth potential.
Concerns over Oracle's $45B-$50B debt and equity program, which may weigh on the stock until the 2030s.
A class action lawsuit alleging misleading statements about its AI infrastructure strategy.
Analysts have downgraded price targets, citing funding risks, delayed OpenAI fundraising, and technical selling pressures.
In Q2 2026, Oracle reported revenue growth of 14.22% YoY to $16.058B and net income growth of 94.70% YoY to $6.135B. EPS increased by 90.91% YoY to 2.1. However, gross margin dropped by 5.74% YoY to 64%, indicating some cost pressures.
Analysts are mixed on Oracle. Some, like Guggenheim, maintain a Buy rating with a $400 price target, citing long-term growth potential. Others, like Melius Research, downgraded the stock to Hold, citing concerns over debt and equity overhang. Price targets have been broadly lowered across firms, reflecting near-term challenges.
