10 Stocks to Watch Ahead of Q3 Earnings Season

4. Oracle Corp (NYSE:ORCL)

Number of Hedge Fund Investors: 124

Alex Haissl, Rothschild and Redburn analyst, recently explained the rationale behind his Sell rating and $175 price target on Oracle Corp (NYSE:ORCL). As of ORCL stock price on September 29, the analyst’s price target represents about 38% downside. The analyst believes the market is overestimating the company’s OpenAI deal and ignores the risks involved.

“The basis is really we see like big headline figures in terms of like order wins and also revenues but our work really shows that the value subscribed to this is relatively low. Because the business model is fundamentally different. If you think about these deals we’re talking about single-tenant deals for dedicated clusters where you know the price and also the costs are pretty much fixed over the contract period. This is a sharp contrast what we know from you know the cloud 1.0 Oh, that we know it and investors really price it where you have basically sweat the asset that over time you have extended server lifetime the hyperscalers then layered software on top and all of a sudden you know in the cloud you had a business model with operating leverage and software like margins. This is not what we are seeing here in terms of like these large scale strategic deals where we where we have like big big headline figures but actually the value is significantly lower.”

The analyst said Oracle Corp (NYSE:ORCL) is facing a “risky blue sky” scenario.

“It’s a risky blue skies scenario. So, we think, you know, the five-year guidance is worth around like 60 billion. And then the question really is how often do you have like renewal cycle of of these five years? So the market is pricing in already very optimistic scenario and completely overlooks the risks.”

Columbia Threadneedle Global Technology Growth Strategy stated the following regarding Oracle Corporation (NYSE:ORCL) in its second quarter 2025 investor letter:

Software database company Oracle Corporation’s (NYSE:ORCL) quarterly results surprised to the upside, and the company ended the quarter by announcing a massive cloud deal that could generate up to $30 billion in annual revenue over the next few years. All in, shares re rated over 50% during the quarter. The company remains early in its accelerating growth inflection and is benefitting from a number of tailwinds across cloud, database and applications.