ORCL Gears Up for Q4 Earnings Report

The equity is up a mere 5% for the quarter

Fernanda Horner
Jun 12, 2020 at 3:16 PM
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The shares of Oracle Corporation (NYSE: ORCL) are up 0.4% to trade at $51.54 this afternoon, on pace to snap its three-day losing streak. The positive price action comes a few days ahead of the company's fiscal fourth-quarter report, which is due after the close on Tuesday. Ahead of the event, Oracle earned a price-target hike from RBC to $50, even though the firm expects fourth-quarter results to be lower than anticipated due to a stronger dollar and low demand.

On the charts, ORCL is quickly recovering from its mid-March three-year low near the $40 level. The equity is not too far from its pre-pandemic high of $55.89 in February, but has had trouble breaking north of the 320-day moving average over the last few months. The stock is now finding overhead pressure near the $54 mark, and for the quarter sports a mere 5% lead.

ORCL 320 MA

Analysts are hesitant toward ORCL, with 14 of the 20 in coverage calling it a "hold," while the remaining six consider it a "buy" or better. However, the 12-month consensus target price of $51.12 runs in-line with current levels.

in the options pits, where the appetite for calls is high. In the last 10 days, 6.73 calls were bought for every put at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX). This ratio sits higher than 98% of readings from the past year, meaning calls are being picked up at a faster-than-usual clip.

A look back at its past eight reports shows a generally dismal post-earnings response for ORCL, which has ended more than half of these next-day sessions lower. The security has averaged a post-earnings swing of 6.2%, regardless of direction. This time around, the options market is pricing in a slightly bigger move of 8.2%.


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