Only One Analyst Rates Oracle a Sell. What Does the Lone Bear See? Trey Thoelcke Tue, November 10, 2026 at 9:06 AM EST 6 min read ORCL -0.59% MSFT -0.45% NVDA -3.75% Explore stocks on Coinbase Trading disclosure Trading disclosure The above button links to Coinbase. Yahoo Finance is not a broker-dealer or investment adviser and does not offer securities or cryptocurrencies for sale or facilitate trading. Coinbase pays us for certain activity generated through this link. Prices displayed are informational.
Oracle trades 97% below Wall Street's consensus target after a 38% slide this year, as investors focus on cash flow and debt over earnings beats.
Capital spending of $29 billion outran operating cash flow of $23 billion in the first quarter, leaving free cash flow negative.
Oracle beat earnings estimates by 10% as cloud infrastructure revenue jumped 121% and remaining performance obligations reached $664 billion.
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Wall Street remains firmly bullish on Oracle (NYSE:ORCL). The analysts' consensus price target of $235.77 implies 96.9% upside from the $119.74 as of the November 9 close.
The market has sided with that view of that lone Wall Street firm. Shares are down 37.75% year to date and trade below both the 50-day average of $139.12 and the 200-day average of $155.40. This report uses the same framework as earlier pieces on Nvidia (NASDAQ:NVDA), Only One Analyst Rates Nvidia a Sell. Is the Lone Bear Onto Something?, and Microsoft (NASDAQ:MSFT), Not One Analyst Rates Microsoft a Sell. Is the Consensus View Right?
In fiscal Q1 2027, Oracle earned $1.92 per share on an adjusted basis against a $1.7391 consensus, beating estimates by 10.4%. Revenue came in at $19.345 billion, ahead of the $19.129 billion estimate. Cloud infrastructure revenue rose 121%, and remaining performance obligations reached $664 billion. Management guided to fiscal 2027 revenue of at least $90 billion and non-GAAP EPS of $8.10.
Analysts have raised their numbers since then. The fiscal 2027 EPS consensus stands at $8.1518, up from $8.0514 90 days ago, and the fiscal 2028 consensus has risen to $11.0636. At a forward P/E of 14, the stock is priced like a slow grower.
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On CNBC's Halftime Report on October 20, Jim Lebenthal said, "These data centers are still profitable the moment they come on" and "You don't see me selling Oracle." (That expansion, and the power, cooling, and networking suppliers riding alongside it, is the whole thesis behind our free report on seven AI infrastructure stocks that aren't chipmakers.) On CNBC's Fast Money on November 3, Karen Finerman praised the $10 billion capital raise for "trading nicely." The same day, Jim Cramer posted on X: "Oracle shows you what happens when you forget that at-the-market sales gambit and you just place the darned stock well and move on."
The bear case rests on cash flow. In Q1, capital spending of $28.50 billion exceeded operating cash flow of $23.10 billion, which left free cash flow at negative $5.40 billion. Interest expense rose 55% to $1.4 billion. Management expects $90 billion to $95 billion of capital spending for the full year. Asked on the September 10 call when free cash flow would turn positive, CFO Hilary Maxson said, "We have not given a particular time frame on that yet."
On the Halftime Report on October 15, Stephanie Link said, "Oracle has 167 billion in debt. Higher rates are going to hurt them." On Fast Money on October 19, Tim Seymour called Oracle "a company that's pushed all their chips into the middle of the table." On Bloomberg Businessweek on November 4, Carol Massar said, "One of their most important data centers for OpenAI has just become one of the most disputed sites for a number of reasons."
Institutional filings for the quarter ended June 30, 2026, show 8 of 13 tracked institutions adding shares, two opening new positions, two reducing, and none leaving. Point72 Asset Management was the largest of these holders with 3,410,580 shares, while Bridgewater Associates trimmed its stake. The positions in these filings are from before the autumn selloff and may differ from what these funds hold today.
Near-term estimates are lower. For the November quarter, the EPS consensus of $1.89 drew one upward revision and three down revisions over the past 30 days.
The bull majority is right about earnings power, and the lone bear is right about what is driving the stock. Investors have been trading Oracle on its cash flow and debt, overlooking its earnings beats. After the Q1 beat, the stock fell 3.7% over the following day. At 14 times forward earnings, the share price already reflects much of the bear's worry. Still, the 96.9% gap to the consensus target will only close once free cash flow improves.
The next earnings report is expected on December 14, 2026. Investors should compare results with guidance for revenue growth of 30% to 34% and EPS of $1.85 to $1.93. The bigger signals will be any timeline for positive free cash flow, how capital spending compares with operating cash flow, and updates on the New Mexico and Wisconsin data center sites.
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