Oracle Corp. (NYSE:ORCL) shares fell nearly 1% in Friday’s premarket session as investors trimmed exposure to large-cap technology stocks. Nasdaq futures were down 1.39%, while S&P 500 futures slipped 0.73%.
Oracle Faces AI Spending Test as Credit Pressure Mounts
However, investor sentiment also remains cautious after a Bloomberg report highlighted growing concerns over Oracle’s aggressive AI infrastructure spending.
The report said S&P Global Ratings recently downgraded Oracle to BBB-, one notch above junk status, while Moody’s continues to maintain a negative outlook.
Analysts cited by Bloomberg said Oracle may need to demonstrate stronger returns from its AI investments, slow capital spending or raise equity if higher borrowing costs persist.
The stock also remains under technical pressure after a prolonged decline. Traders are watching whether Oracle can hold near its recent lows as investors rotate away from high-growth technology names.
New Mexico Rejects Gas Pipeline Permit for Oracle Data Center
Separately, New Mexico regulators have denied, for the second time, permits for a natural gas pipeline that would supply Oracle’s proposed Project Jupiter data center, potentially delaying the AI infrastructure project.
Bloomberg reported that Oracle said the project remains on schedule, while Energy Transfer continues pursuing permits and could consider rerouting the pipeline to avoid state-owned land.
Oracle Technical Analysis
Oracle continues to trade well below its major moving averages, signaling that the broader trend remains bearish. The stock sits 17.3% below its 20-day simple moving average, 31.7% below its 50-day SMA and 36.2% below its 200-day SMA.
The 20-day SMA remains below the 50-day SMA, reinforcing weak near-term momentum. Meanwhile, the death cross formed in January, when the 50-day SMA fell below the 200-day SMA, continues to point to longer-term downside pressure.
Momentum indicators suggest the stock is deeply oversold. Oracle’s relative strength index stands at 26.73 after falling below 30 this month. While such readings can precede short-term rebounds, they do not confirm a lasting bottom unless the stock begins forming higher lows.
The nearest resistance level is around $148.53, near the 20-day SMA. Initial support sits near $123.66, close to the stock’s 52-week low.
Earnings Outlook
Oracle remains one of the world’s largest enterprise software providers. Its database business continues to generate recurring revenue, while its cloud infrastructure business has become an increasingly important growth driver as companies expand AI-related workloads.
The company’s next major catalyst is its estimated earnings report on Sept. 8, 2026. Analysts expect earnings of $1.67 per share, up from $1.47 a year earlier, on revenue of $19.12 billion, compared with $14.93 billion last year.
Wall Street maintains a Buy consensus rating with an average price target of $264.64. Recent analyst actions include Bernstein raising its price target to $325, TD Cowen maintaining a Buy rating with a $300 target and RBC Capital maintaining a Sector Perform rating with a $190 target.
Oracle Benzinga Edge Rankings
Oracle scores well on growth but poorly on momentum. Benzinga Edge assigns the stock a Growth score of 91.55, a Value score of 23.23 and a Momentum score of 3.93.
The combination suggests investors still see attractive long-term growth potential, but weak price action continues to weigh on sentiment.
ETF Exposure
Oracle remains a significant holding in several technology-focused exchange-traded funds, including the iShares Expanded Tech-Software Sector ETF (BATS:IGV), where it accounts for 5.87% of assets, the First Trust NASDAQ Technology Dividend Index Fund (NASDAQ:TDIV) at 9.82%, and the Pacer Data and Digital Revolution ETF (NYSE:TRFK) at 7.57%.
Large inflows or outflows in these funds can create additional buying or selling pressure for Oracle shares.
Oracle Price Action
ORCL Stock Price Activity: Oracle shares were down 0.96% at $123.02 during premarket trading on Friday, according to Benzinga Pro data.
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