Jun 11, 2024

The price of Oracle has bounced from resistance, with earnings ahead on Tuesday.


ORCL – Daily Chart 

ORCL shares found resistance at $126.65 and traded at $124.25. The previous earnings release led to a slump in the share price, which found support at the $114.58 level. 

Analysts expect the Austin, Texas-based tech firm to report quarterly earnings at $1.65 per share. That would be down from $1.67 per share in the year-ago period. Oracle is forecast to post quarterly revenue of $14.59 billion, compared to $13.84 billion a year ago. 

The tech giant recently released plans to open two Oracle Cloud Regions in Morocco, offering enterprise cloud services to African organisations. 

Analysts will look for momentum in Oracle’s cloud infrastructure business after cloud revenue was up 25% year-over-year in its third quarter, with cloud infrastructure revenue up 49% for the same period.

“We expect to continue receiving large contracts reserving cloud infrastructure capacity because the demand for our Gen2 AI infrastructure substantially exceeds supply — despite the fact we are opening new and expanding existing cloud data centres very, very rapidly,” said Oracle CEO Safra Catz after the last results. 

In the company’s earnings call, analysts may also look for an update on the reported collaboration between Oracle and xAI, Elon Musk’s AI startup. A report from The Information said that xAI was finalising a $10 billion contract with Oracle for cloud services. 

UBS analyst Karel Keirstead has a Buy rating on Oracle and recently increased the company’s price target from $130 to $150. Other analysts, including TD Cowen’s Derrick Wood, have similar price ratings, around $130 to $140.

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