ORCL Stock Falls -20% With A 7-day Losing Spree On Analyst Downgrades & Capex Fears
Oracle (ORCL) – a cloud software and enterprise database service provider – hit a 7-day losing streak, with cumulative losses over this period amounting to -20%. The company’s market cap has crashed by about $102 Bil over the last 7 days and currently stands at $420 Bil.
The stock has YTD (year-to-date) return of 24.6% compared to 0.5% for S&P 500. This calls for a re-evaluation of the stock’s valuation to find out whether this is an opportunity or a trap.
What Triggered The Slide?
[1] Wave of Analyst Downgrades and Price Target Cuts
- Morgan Stanley slashed its price target from $320 to $213 [2, 3]
- Scotiabank, UBS, and RBC Capital also cut price targets [3, 14]
- Impact: Accelerated Selling Pressure, Negative Institutional Sentiment
[2] AI Infrastructure Spending and Fundraising Concerns
- Plan to raise $45-$50 billion in 2026 via debt and equity [8, 10, 15]
- Market hostility to AI capex following Microsoft’s earnings [1, 3]
- Impact: Investor anxiety over massive capital expenditure, Fears of equity dilution and growing debt burden
[3] Bondholder Lawsuit
- Lawsuit alleges Oracle misled investors over capital needs for AI buildout [2]
- Filed on behalf of investors who bought $18 billion of debt [3]
- Impact: Increased legal and financial risk, Damaged investor confidence
Opportunity or Trap?
Below is our take on valuation.
There is not much to fear in ORCL stock given its overall Strong operating performance and financial condition. This is aligned with the stock’s High valuation because of which we think it is Fairly Priced (For details, see Buy or Sell ORCL).
But here is the real interesting point.
You are reading about this -20% move after it happened. The market has already priced in the news. To avoid the next loser before the headlines, you need predictive signals, not notifications. Our High Quality Portfolio has a risk model designed to reduce exposure to losers.
Returns vs S&P 500
The following table summarizes the return for ORCL stock vs. the S&P 500 index over different periods, including the current streak:
| Return Period | ORCL | S&P 500 |
|---|---|---|
| 1D | -5.2% | -0.5% |
| 7D (Current Streak) | -19.6% | -1.0% |
| 1M (21D) | -23.6% | -0.3% |
| 3M (63D) | -43.0% | 0.4% |
| YTD 2026 | -24.6% | 0.5% |
| 2025 | 18.1% | 16.4% |
| 2024 | 60.0% | 23.3% |
| 2023 | 30.9% | 24.2% |
Gains and Losses Streaks: S&P 500 Constituents
There are currently 124 S&P constituents with 3 days or more of consecutive gains and 36 constituents with 3 days or more of consecutive losses.
| Consecutive Days | # of Gainers | # of Losers |
|---|---|---|
| 3D | 61 | 12 |
| 4D | 22 | 7 |
| 5D | 27 | 4 |
| 6D | 13 | 5 |
| 7D or more | 1 | 8 |
| Total >=3 D | 124 | 36 |
Key Financials for Oracle (ORCL)
Last 2 Fiscal Years:
| Metric | FY2024 | FY2025 |
|---|---|---|
| Revenues | $53.0 Bil | $57.4 Bil |
| Operating Income | $16.1 Bil | $18.1 Bil |
| Net Income | $10.5 Bil | $12.4 Bil |
Last 2 Fiscal Quarters:
| Metric | 2026 FQ1 | 2026 FQ2 |
|---|---|---|
| Revenues | $14.9 Bil | $16.1 Bil |
| Operating Income | $4.7 Bil | $5.2 Bil |
| Net Income | $2.9 Bil | $6.1 Bil |
The losing streak ORCL stock is currently on doesn’t inspire much confidence among investors. In contrast, Trefis High Quality (HQ) Portfolio, with a collection of 30 stocks, has a track record of comfortably outperforming its benchmark that includes all 3 — the S&P 500, S&P mid-cap, and Russell 2000 indices. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride, as evident in HQ Portfolio performance metrics.