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If You Own Oracle (ORCL) Stock, Should You Sell It Now?

If you are looking for the best ideas for your portfolio you may want to consider some of Ensemble Capital’s top stock picks. Ensemble Capital, an investment management firm, is bearish on Oracle Corp (NYSE:ORCL) stock. In its Q4 2019 investor letter – you can download a copy here – the firm discussed its investment thesis on Oracle Corp (NYSE:ORCL) stock. Oracle Corp (NYSE:ORCL) is a computer software company based in California. The stock is up 1.4% since the Ensemble Capital’s pitch in January 2020, which suggests the investment firm was wrong in its decision. On a year-to-date basis, Oracle Corp (NYSE:ORCL) stock has risen by 6.1%.

On January 22, 2020, Ensemble Capital had released its Q4 2019 Investor Letter. Ensemble Capital said that Oracle Corp (NYSE:ORCL) doesn’t meet the investment firm’s portfolio inclusion criteria and as a result exited the stock.

For the quarter ended December 31st, 2019, Ensemble Fund recorded a return of 9.87%, compared to 9.07% of the S&P 500 Index. This brings its 2019 full-year return to 39.55%, compared to 31.49% of the S&P 500 Index.

Let’s take a look at comments made by Ensemble Capital about Oracle Corp (NYSE:ORCL) in the letter.

“We sold out of Oracle after losing conviction that the company can achieve the transition to their software-as-a-service business model with the speed and earnings power that we had expected. The transition had been taking longer than we initially forecasted and the company has stopped reporting on certain key measures that we believed were important indicators for us to track the progress. After much debate, we decided that the company no longer fully meets our requirements for inclusion in our portfolio due to the businesses future simply not being forecastable enough for us to have confidence in valuing the stock.”

Oracle ORCL

Our calculations showed that Oracle Corp (NYSE:ORCL) isn’t ranked among the 30 most popular stocks among hedge funds.

The top 10 stocks among hedge funds returned 185% since the end of 2014 and outperformed the S&P 500 Index ETFs by more than 109 percentage points. We know it sounds unbelievable. You have been dismissing our articles about top hedge fund stocks mostly because you were fed biased information by other media outlets about hedge funds’ poor performance. You could have doubled the size of your nest egg by investing in the top hedge fund stocks instead of dumb S&P 500 ETFs. Below you can watch our video about the top 5 hedge fund stocks right now. All of these stocks had positive returns in 2020.

Video: Top 5 Stocks Among Hedge Funds

At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, 2020’s unprecedented market conditions provide us with the highest number of trading opportunities in a decade. So we are checking out stocks recommended/scorned by legendary Bill Miller. We interview hedge fund managers and ask them about their best ideas. If you want to find out the best healthcare stock to buy right now, you can watch our latest hedge fund manager interview here. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. Our best call in 2020 was shorting the market when the S&P 500 was trading at 3150 after realizing the coronavirus pandemic’s significance before most investors. You can subscribe to our free enewsletter below to receive our stories in your inbox:

Disclosure: None. This article is originally published at Insider Monkey.