On September 2, a caller pointed to market anxiety over Oracle Corporation’s (NYSE:ORCL) data center loans and asked if rising moratoria and negative sentiment surrounding data center production actually increase the value of Oracle’s current approvals and builds by throttling competing capacity. Mad Money host Jim Cramer replied:
That’s a good way to look at it… It’s a little too optimistic. People have gotten comfortable with the idea that Oracle is going to put up as many as they can. So, anything that indicates that they’re not going to be able to put up as many is going to make it so Oracle stock goes lower. I would prefer to just stick right point blank with NVIDIA. And, by the way, I think Dell is still a terrific stock to own, even all the way up here.
Cloud Expansion and Backlog Momentum
Oracle Corporation has experienced massive scaling across its Oracle Cloud Infrastructure (OCI) division, driven by surging enterprise demand for artificial intelligence training, multi-cloud database integrations, and major enterprise commitments. The company’s expansion is supported by a strong remaining performance obligation pipeline of around $638 billion, showing multi-year demand. Strong enterprise adoption of OCI continues to drive consistent top-line momentum as businesses modernize their database and cloud architectures.
Infrastructure Hurdles and Capital Intensity Pressures
The main risk for Oracle Corporation comes down to massive capital expenditure and high debt as the company builds out advanced data center regions to meet artificial intelligence demands, which puts ongoing pressure on free cash flow. On top of that, turning massive infrastructure pipelines into high-margin recurring revenue needs to happen without any operational hiccups. Fierce competition from major hyperscalers, like Microsoft Azure, Amazon Web Services, and Google Cloud, adds structural pressure, while supply chain bottlenecks for specialized networking gear continue to threaten timely project delivery.
Institutional Footprint and Short Interest
According to Insider Monkey’s database tracking over 1,000 elite hedge funds, the number of hedge fund holders in Oracle Corporation stood at 119 in the second quarter, ticking up slightly from 115 holders in Q1. Among those hedge funds, Fisher Asset Management remained the top shareholder of the company with nearly 13.3 million shares after increasing its position by 39%. Market data compiled across financial platforms shows that short interest stands at approximately 2.78% to 2.81% of the public float.
For Cramer, the operational complexities tied to massive data center buildouts make direct hardware and semiconductor exposure more compelling. Rather than navigating the execution risks surrounding Oracle’s infrastructure pipeline, Cramer prefers investments in leaders like NVIDIA, along with hardware integrators like Dell, which continue to show solid operational momentum.
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