Oracle Trading Like a Penny Stock
Oracle just pulled off one of the wildest moves in recent stock market history. The stock exploded more than 40% in a single day – and we’re not talking about some biotech microcap or crypto stock. This is Oracle, a $500+ billion company suddenly trading like a penny stock. That move pushed Larry Ellison to the very top of the rich list, making him the richest man on the planet with close to $400 billion. Unreal. Elon Musk won’t be happy about that. Though Tesla might see a similar hype cycle if they ever actually deliver on one of their endless promises – whether it’s AVs or humanoid robots.
The cloud giant has never been an investor’s favorite – in fact, most people probably couldn’t even explain in the slightest what Oracle does – but the company never really had a down quarter. Now, Oracle hasn’t exactly been a forgotten legacy dinosaur. The company has been grinding higher for years, steadily growing and delivering. But what happened this week is on another level. The trigger was AI: huge contracts, including a reported $300 billion deal with OpenAI, have suddenly positioned Oracle as a real backbone of the new AI economy. Ellison has been betting heavily on cloud and infrastructure for years, and this was the moment it all clicked. And in fairness: AI is the mega-trend of our time. It will shape economies, companies, and societies more than almost anything else. So yes, euphoria is justified – to a point.
Personally, I like Oracle a lot. I even held it in my portfolio about a year ago. And Larry Ellison deserves credit – his vision, his bold bets, and the fact that he’s still at the helm at 81 is nothing short of remarkable. But let’s be honest: at a forward P/E north of 60 and an EV/revenue multiple above 14, the stock is priced for perfection. That’s stretched, no matter how you slice it. Let’s not forget what just happened to Synopsys. After all, stock prices can fall just as quickly as they can rise. If I wanted a pure AI play and didn’t care about valuation, I’d rather own Nvidia or Microsoft – which, by the way, still trade at much more reasonable levels compared to what Oracle just shot up to.
Ellison deserves admiration, no doubt. He played the long game and is now sitting on the throne as the world’s richest man. But when a Dow Jones-style giant moves like a meme stock, it tells you something about the market we’re in. Oracle might indeed help define the AI future – but right now, this rally feels more like exuberance than balance. However, this should be taken with a pinch of salt: I wouldn’t buy in right now, but I also wouldn’t bet against it. If I still held Oracle, I don’t think now is the time to sell, maybe to trim, but selling your biggest winners often doesn’t pay off and can seriously limit your upside. I’m happy for Ellison – let’s see how long he can keep that spot.
