A sign is hung in front of Oracle headquarters on December 9, 2021 in Redwood Shores, California.
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Shares of Oracle up 15.6% on the Friday after the company Reported earnings and sales beat analyst estimates for the second quarter of 2022.
Oracle stock had its best day since March 2020 and its second-biggest gain in 20 years. The spike added nearly $38 billion to its market capitalization, raising it to $280.6 billion.
The rally added nearly $16 billion to the personal fortune of Oracle Chairman and founder Larry Ellison.
According to Refinitiv, the company reported $1.21 per share, adjusted for earnings, exceeding analyst estimates of $1.11 per share. It also brought in $10.36 billion in revenue for the quarter, beating estimates of $10.21 billion.
Wall Street likes Oracle’s cloud strategy.
Deutsche Bank on Friday upgraded Oracle to a buy rating and raised its price target from $110 to $120. “Oracle reported its cleanest quarter in years, based on all relevant indicators and guidance above expectations over time,” Deutsche Bank analysts said in a note to investors. remainder of fiscal year 22”. “While strongly confirming Oracle’s strategy, it appears we are finally seeing an ongoing positive mix of change driving a meaningful shift in finances.”
“Despite an overvaluation that ORCL stock has not seen in nearly 15 years, we believe the next move will be driven by confidence in OCI (Oracle Cloud Infrastructure). ) as a trusted player in the broader public cloud market,” added the bank analysts.
Piper Sandler and Stifel Nicolaus also raised their price targets but maintained their rating equal to hold.
However, Oracle reported a net loss for the quarter of $1.25 billion compared with the $2.44 billion in net income it reported in the previous quarter. It was due to a payment arising from a ruling in a long-running dispute involving former CEO Mark Hurd’s arrival at the company in 2010 from HP. Hurd died in 2019.
Oracle reported guidance for its fiscal third quarter fell to the average of Wall Street expectations, with a revised $1.16 per share. It also projected revenue of $10.56 billion, implying revenue growth of about 5%, which is high in the range of analysts’ estimates.
Jordan Novet of -CNBC contributed to this report.
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