ORCL Stock Could Be Near A Turning Point, Says Jefferies As ‘Peak-Negative’ Investor Sentiment Sets In

Oracle stock was heading for a fourth consecutive decline Wednesday after losing more than 7% over the previous three sessions.

• Jefferies cut its Oracle price target to $290 from $320 but maintained a ‘Buy’ rating.
• The firm believes stronger cloud growth and an uptick in SaaS could “dispel some of the bear thesis.”
• TD Cowen also lowered its Oracle price target to $240 from $300 while maintaining a ‘Buy’ rating and pointing to the Oct. 28 analyst day as a key catalyst.

Oracle (ORCL) shares were on track to fall for a fourth consecutive session Wednesday, but Jefferies said sentiment toward the stock is "near peak-negative" and much of the bad news may already be priced in.

In a note to investors cited by TheFly, Jefferies analyst Brent Thill lowered the firm's price target on Oracle to $290 from $320 while maintaining a ‘Buy’ rating.

ORCL stock fell as much as 1.5% in pre-market trade amid broader market weakness after a tumble of over 5% in the previous session. The stock has fallen over 7% in the last three days, on track to log a fourth day in the red.

On Stocktwits, retail sentiment around the company trended in ‘bearish’ territory over the past day, accompanied by chatter at ‘normal’ levels. 

Cloud Growth Could Challenge The Bear Thesis

The analyst said the firm likes Oracle's setup heading into its fiscal first-quarter results, despite the period being "seasonally soft." While investor sentiment around Oracle has fallen, Thill believes most of the negative expectations are already priced into the stock. 

He added that a growth inflection in Oracle’s cloud business and uptick in software-as-a-service (SaaS) “could dispel some of the bear thesis.”

Jefferies trimmed price target of $320 still implies a potential upside of over 105% from Tuesday’s close.

TD Cowen Also Cuts Oracle Price Target

On Tuesday, TD Cowen also lowered its price target on Oracle to $240 from $300 while maintaining a ‘Buy’ rating. The firm flagged Oracle’s analyst day on October 28 as the next major catalyst. The event is expected to focus heavily on the company’s cloud business, with Oracle likely to issue updated fiscal 2030 targets, TD Cowen said in an investor note.

Oracle closed Tuesday at roughly $141, which means TD Cowen’s $240 target implies about 70% upside.

According to Koyfin data, the average 12-month price target on Oracle stands at around $242, implying a 71% upside. Out of the 44 analysts covering the stock, 36 gave Oracle a ‘Buy’ or ‘Strong Buy’ rating, with seven recommending ‘Hold’ and only one giving it a ‘Sell’ rating.

How Is Retail Feeling About ORCL Stock?

One Stocktwits user described ORCL as “one of the rare names in this sector that hasn’t already run 200%+” and called it worth considering for new investors.

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Another investor said the stock could be a “good buying opportunity” and expected it to move higher into earnings, scheduled for September 8. Wall Street expects Oracle to report earnings per share (EPS) of $1.74 on revenue of $19.13 billion.

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ORCL’s stock has fallen almost 30% this year and around 37% in the last 12 months. The recent pressure also comes against a difficult backdrop for technology stocks. The broader market sold off Tuesday, with the Nasdaq Composite falling about 1%.

The recent pressure also comes against a difficult backdrop for technology stocks. The broader market sold off Tuesday, with the Nasdaq Composite falling about 1%, while Oracle dropped 5.23%.

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