Latest / Earn Your Leisure / Investor Daily l: Is Now the Time to Buy Oracle? Cloud Profits, & Risks

Transcript

Investor Daily l: Is Now the Time to Buy Oracle? Cloud Profits, & Risks · Earn Your Leisure

• 0:01
  Speaker 1: This episode is brought to you by P and C Bank.
• 0:03
  Speaker 1: A lot of people think podcasts about work are boring,
• 0:06
  Speaker 1: and sure they definitely can be, but understanding of professional's
• 0:10
  Speaker 1: routine shows us how they achieve their success little by little,
• 0:14
  Speaker 1: day after day. It's like banking with P and C Bank.
• 0:18
  Speaker 1: It might seem boring to safe plan and make calculated
• 0:21
  Speaker 1: decisions with your bank, but keeping your money boring is
• 0:24
  Speaker 1: what helps you live a more happily fulfilled life. P
• 0:27
  Speaker 1: and C Bank Brilliantly Boring since eighteen sixty five. Brilliantly
• 0:32
  Speaker 1: Boring since eighteen sixty five is a service mark of
• 0:35
  Speaker 1: the PNC Financial Service Group, Inc. P and C Bank
• 0:39
  Speaker 1: National Association Member FDIC.
• 0:43
  Speaker 2: Talking about a stock pullback, let's talk about Oracle. We
• 0:48
  Speaker 2: talked about it a little bit last week, but Oracle still,
• 0:52
  Speaker 2: you know, fighting its way out of its pullback.
• 0:56
  Speaker 3: Is now the time to buy Oracle? I don't think so.
• 1:02
  Speaker 4: Stock Club put in chat if I can put it
• 1:03
  Speaker 4: in one of the prices, I think.
• 1:10
  Speaker 3: You definitely need to wait to.
• 1:13
  Speaker 4: One at least one sixty before you're willing to pull
• 1:17
  Speaker 4: the trigger. If you look at the Fibonacci from the
• 1:22
  Speaker 4: all time high, over the last five years. Is underneath
• 1:24
  Speaker 4: that fifty percent marks two or two seventy three. That's
• 1:28
  Speaker 4: usually not a good sign. But there is a place
• 1:30
  Speaker 4: where it's sitting where there is some signs true. I
• 1:34
  Speaker 4: don't know if you want to queue it up, but
• 1:35
  Speaker 4: there is a place that I do like to start
• 1:38
  Speaker 4: to look to buy an asset. One thing I will say, though,
• 1:43
  Speaker 4: we have to stop looking for companies to give in
• 1:45
  Speaker 4: Vidia like returns that are not in video, because then
• 1:49
  Speaker 4: even in video aren't going to be going to be
• 1:51
  Speaker 4: able to give those returns that they've had since twenty
• 1:53
  Speaker 4: twenty one. It's a different market, it's a different climate.
• 1:58
  Speaker 4: The truth about the economy is coming up out a
• 2:01
  Speaker 4: lot faster. People are starting to brace for a recession,
• 2:04
  Speaker 4: and risk is all for most hedge funds. So if
• 2:07
  Speaker 4: you like it, you have to like it at the
• 2:09
  Speaker 4: right price. But if it's really at its fair value
• 2:13
  Speaker 4: price for where it should be.
• 2:16
  Speaker 3: But I would definitely wait for.
• 2:17
  Speaker 4: Like that one sixty area to start to acquire equities
• 2:21
  Speaker 4: and in this company.
• 2:22
  Speaker 1: Yeah, I'll start by saying this, and this is important
• 2:25
  Speaker 1: to know. Cloud profitability is future dated, right, So if
• 2:29
  Speaker 1: you're writing notes, write that down in your notes. Cloud
• 2:32
  Speaker 1: profitability is future dated, meaning that there's going to be
• 2:36
  Speaker 1: profits down the road, but it takes time.
• 2:39
  Speaker 3: And so what happened to Oracle.
• 2:41
  Speaker 1: Yes, we've talked about the investment that they've made, and
• 2:45
  Speaker 1: the idea is if you build it, they will come.
• 2:47
  Speaker 1: The reality is that you have to build it, and
• 2:50
  Speaker 1: the problem that people are seeing is that the cost
• 2:52
  Speaker 1: that it's going to take to build is really strenuous
• 2:55
  Speaker 1: on its capex, which is interesting because that it feels
• 3:00
  Speaker 1: like a natural thing. If we're going to spend more
• 3:02
  Speaker 1: to make more, that we need that time period to
• 3:04
  Speaker 1: do it. The problem is that their cloud service in
• 3:07
  Speaker 1: the immediate standpoint was growing, and so what did I say.
• 3:10
  Speaker 3: I wanted to see.
• 3:11
  Speaker 1: I wanted to see if the cloud business was continued
• 3:13
  Speaker 1: to growing, to continue to grow, and it did, right,
• 3:16
  Speaker 1: they add a new customers, the crowd business went from
• 3:19
  Speaker 1: I think thirty two percent up to thirty nine percent
• 3:22
  Speaker 1: of forty percent.
• 3:23
  Speaker 3: That's a good sign.
• 3:24
  Speaker 1: So I start studying who else in the cloud service
• 3:28
  Speaker 1: business has had this type of run.
• 3:30
  Speaker 3: Right, So we got to go back to the pioneer
• 3:32
  Speaker 3: of all this.
• 3:32
  Speaker 1: Right, when we talk about cloud service, it starts with
• 3:34
  Speaker 1: AWS in two thousand and six. In two thousand and six,
• 3:38
  Speaker 1: people were not talking about cloud. In fact, they weren't
• 3:41
  Speaker 1: even worrying about the profitability because that was not the
• 3:43
  Speaker 1: core focus of Amazon's business. Right, this is an e
• 3:46
  Speaker 1: commerce thing. They add this as a derivative to their portfolio.
• 3:51
  Speaker 1: Ten years down the line. Now AWS is the thing
• 3:54
  Speaker 1: that we know it and it's profitable. Two thousand and eight.
• 3:57
  Speaker 1: Amazon season not Google sees the same. Right, they watched
• 4:00
  Speaker 1: what Amazon did. They created Google Cloud, same thing. Right,
• 4:04
  Speaker 1: we got to pioneer with AWS, We got the technology,
• 4:06
  Speaker 1: and they led into adaption into the Google space. Now
• 4:09
  Speaker 1: that becomes a revenue for them six years down the line.
• 4:12
  Speaker 1: So now we're talking to twenty sixteen, we're starting to
• 4:14
  Speaker 1: see profitability. Oracle just turned over to a cloud business
• 4:18
  Speaker 1: in twenty eighteen, So we're right in that that frame
• 4:21
  Speaker 1: here of where are we going to see profitability from it?
• 4:23
  Speaker 1: It just so happens that it's coming at the same
• 4:25
  Speaker 1: time as a CAPEC spin. I'm going to give you
• 4:27
  Speaker 1: another company, and I'm gonna tell you what the report
• 4:30
  Speaker 1: said inside the cloud space. This company, the cloud business
• 4:35
  Speaker 1: was growing fast, but it wasn't yet dominant. We already
• 4:37
  Speaker 1: know that Oracle is number four in the space, right,
• 4:39
  Speaker 1: we talked about the other other three. This company, they
• 4:42
  Speaker 1: said that they had a heavy cloud capex depressing their margins, right,
• 4:46
  Speaker 1: so the amount of money they were spending, the margins
• 4:48
  Speaker 1: were getting dinner.
• 4:49
  Speaker 3: How are we going to pay for this?
• 4:50
  Speaker 1: They said their software still was the core profit engine,
• 4:53
  Speaker 1: very similar to Oracle. They also said that their market
• 4:56
  Speaker 1: was unsure if the company could really pivot from being
• 4:59
  Speaker 1: a software where to a cloud service. You know what
• 5:01
  Speaker 1: that company's name was, which one absorbed by Microsoft. Now
• 5:07
  Speaker 1: if we look at it today, it's number three in
• 5:09
  Speaker 1: the cloud space. And so when I'm telling you that
• 5:12
  Speaker 1: profitability takes time and it's future dated, that's what we're
• 5:15
  Speaker 1: saying here. The issue here is obviously AI in the
• 5:19
  Speaker 1: mix of all of this, right, and so now when
• 5:21
  Speaker 1: we look at Oracle, it's like, hey, they've reinvented themselves
• 5:24
  Speaker 1: a few times already. They started out as enterprise software.
• 5:27
  Speaker 1: They went from enterprise software to subscriptions. Now they're going
• 5:31
  Speaker 1: from subscriptions right in that AI software to now cloud
• 5:34
  Speaker 1: service and obviously everything comes to the AI. It's going
• 5:37
  Speaker 1: to take time. Are they at the prime place? Well,
• 5:40
  Speaker 1: There's this guy listened to every Monday. His name is
• 5:43
  Speaker 1: Ian Dunlap. He talks about this moving average for the
• 5:46
  Speaker 1: four hundred day moving average. Ian Oracle is sitting at
• 5:51
  Speaker 1: one three eighty two. That is representation of.
• 5:56
  Speaker 3: What give them my levels at the market.
• 6:03
  Speaker 1: It is currently at it's four hundred day e m A,
• 6:09
  Speaker 1: which is a sign. And I'll leave it at that
• 6:11
  Speaker 1: if you know, you know, But Oracle is not going anywhere.
• 6:17
  Speaker 1: The cloud space is going to be a space that
• 6:19
  Speaker 1: they're going to play a part in. Obviously they are
• 6:22
  Speaker 1: number four UH in the United States five globally. But
• 6:26
  Speaker 1: I think were what's happening is now you're starting to
• 6:29
  Speaker 1: see the sediment changed. The same way we talked about
• 6:31
  Speaker 1: the positive sediment when we're talking about Tesla and Eli Musk,
• 6:34
  Speaker 1: you're seeing negative sentiment around Oracle. You've see credit, the
• 6:38
  Speaker 1: false swaps, I mean the credit the false which is crazy,
• 6:42
  Speaker 1: have spiked through the roof, meaning people are saying, look,
• 6:45
  Speaker 1: we're gonna bet that if they can't pay.
• 6:47
  Speaker 3: It right, we need to make money off of it.
• 6:49
  Speaker 1: We're betting on them not outside, they're betting on them
• 6:52
  Speaker 1: not being able to pay this off. I think that's
• 6:55
  Speaker 1: interesting and people are making money off that. In the
• 6:57
  Speaker 1: short term, I think this is oracle be to stay.
• 7:00
  Speaker 1: You're talking about the third or fourth wealth wealthiest person
• 7:04
  Speaker 1: in the world. When we're talking about Larry Ellison, obviously
• 7:07
  Speaker 1: he has government backing.
• 7:08
  Speaker 3: On his side.
• 7:09
  Speaker 1: This will this will turn around. But it's an interesting
• 7:12
  Speaker 1: point right now that it's out.
• 7:13
  Speaker 3: Can I play Devil's advocate real quick?
• 7:15
  Speaker 4: Will people be so pro oracle if he didn't have
• 7:18
  Speaker 4: Trump in his back pocket? Because prior to him getting in, Yeah,
• 7:27
  Speaker 4: most people weren't not looking at.
• 7:30
  Speaker 3: Larry in the way that he should be revered. But
• 7:33
  Speaker 3: the stock was not a tech darling.
• 7:35
  Speaker 1: You're right, and I think yes, I'm going to say yes,
• 7:39
  Speaker 1: And I'm not saying because of this administration. Right, I'm
• 7:42
  Speaker 1: thinking when he was president last time, So when he
• 7:45
  Speaker 1: was forty five, the tea leaves were there. Right when
• 7:48
  Speaker 1: we're talking about who's getting cloud contracts from the government,
• 7:53
  Speaker 1: who's making the tik tok fiasco, who's going to be
• 7:56
  Speaker 1: the cloud server for them, that's worked in this favor. Obviously,
• 7:59
  Speaker 1: now when we're talking about opening Eye and Stargate, that's
• 8:02
  Speaker 1: worked in his favor. So is he a huge donor
• 8:05
  Speaker 1: of that campaign one thousand percent. Have we seen a
• 8:10
  Speaker 1: clear pattern of how he makes sure that the people
• 8:13
  Speaker 1: that are closest to him and take care of him
• 8:15
  Speaker 1: are being taken care of earners.
• 8:18
  Speaker 3: What's up?
• 8:19
  Speaker 1: You ever walk into a small business and everything just
• 8:21
  Speaker 1: works like the checkout is fast, their seats are digital,
• 8:25
  Speaker 1: tipping is a breeze, and you're out the door before
• 8:28
  Speaker 1: the line even builds. Odds are they're using Square. We
• 8:32
  Speaker 1: love supporting businesses that run on Square because it just
• 8:35
  Speaker 1: feels seamless. Whether it's a local coffee shop, a vendor
• 8:38
  Speaker 1: at a pop up market, or even one of our
• 8:40
  Speaker 1: merch partners. Square makes it easy for them to take payments,
• 8:44
  Speaker 1: manage inventory, and run their business with confidence, all from
• 8:48
  Speaker 1: one simple system. One of the things we love most
• 8:51
  Speaker 1: is seeing neighborhood businesses level up disess West Indian Spot
• 8:55
  Speaker 1: right in our community that started with a small takeout
• 8:58
  Speaker 1: counter now with Square, been able to expand into a
• 9:01
  Speaker 1: full sit down restaurant and even started catering events across
• 9:05
  Speaker 1: the city. That's the kind of growth that inspires us,
• 9:08
  Speaker 1: and it's powered by Square. Square is built for all
• 9:11
  Speaker 1: types of businesses. From the corner bagel shop that turned
• 9:14
  Speaker 1: into a local chain to the specialty market with thousands
• 9:18
  Speaker 1: of unique items, to the stylist who's been holding you
• 9:21
  Speaker 1: down for years. If you're a business owner or even
• 9:24
  Speaker 1: just thinking about launching something soon, Square is hands down
• 9:27
  Speaker 1: one of the best tools out there to help you start,
• 9:30
  Speaker 1: run and grow. It's not just about payments, it's about
• 9:34
  Speaker 1: giving you time back so you can focus on what
• 9:36
  Speaker 1: matters most Ready to see how Square can transform your business,
• 9:40
  Speaker 1: visit Square dot com backslash, go backslash eyl to learn
• 9:45
  Speaker 1: more that Square dot com backslash, go backslash eyl. Don't wait,
• 9:50
  Speaker 1: don't hesitate. Let Square handle the back end so you
• 9:53
  Speaker 1: can keep pushing your vision forward.