Oracle Shares Climb to Record, Boosting Options Volume Amid AI Optimism
$Oracle(ORCL.US$ shares climbed to a record Wednesday, helping boost the appeal of its stock options amid expectations that the cloud software provider could benefit from increasing demand from artificial intelligence applications.
On Tuesday, Oracle Chairman Larry Ellison said he expects the company's cooperation with $Microsoft(MSFT.US$ to "turbocharge" its cloud data base growth. He also said the Oracle database could be available with the $Alphabet-A(GOOGL.US$'s Cloud in September.
Hopes over the demand prospects for training AI large language models in Oracle Cloud overshadowed the company's disappointing fiscal fourth quarter results released after the market closed Tuesday. The company reported adjusted earnings of $1.63 per share and revenue of $14.29 billion for the three months ended May 31. That trailed the average estimate of $1.65 for the adjusted EPS and revenue of $14.57 billion, MT Newswires reported, citing analysts polled by Capital IQ.
Shares soared more than 13% to $140.29, an all-time closing high. Oracle was the day's biggest gainer on the $S&P 500 Index(.SPX.US$, outpacing the benchmark's 0.9% rise. More than 435,000 options were traded, landing Oracle in the 10th place among the stock options with the highest volume.
Financial giants were also spending millions of dollars in options, helping boost the total volume. At 10:25:42 a.m., two block trades were posted. One of them involved call options that give the holder the right to buy 160,000 Oracle shares at $125 each by June 21. The seller stands to collect a premium of $2.28 million for writing those call options which were executed near the bid price, signaling its bearish tendency.
The other trade gives the holder the right to buy the same amount of Oracle shares for $140 each, with the call options expiring on the same date. The buyer paid a $296,000 premium for the trade that was executed near the asking price, signaling its bullish tendency.
Sentiment on these block trades is mixed at a time when 12 of 15 technical indicators are signaling that the stock is overbought and could be trending bearish. Still, Oracle has seen a net inflow of $336.5 million, driven by funds from small and large orders that fueled the rally.
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Options trading entails significant risk and is not appropriate for all customers. It is important that investors read Characteristics and Risks of Standardized Options before engaging in any options trading strategies. Options transactions are often complex and may involve the potential of losing the entire investment in a relatively short period of time. Certain complex options strategies carry additional risk, including the potential for losses that may exceed the original investment amount. Supporting documentation for any claims, if applicable, will be furnished upon request. Moomoo does not guarantee favorable investment outcomes. The past performance of a security or financial product does not guarantee future results or returns. Customers should consider their investment objectives and risks carefully before investing in options. Because of the importance of tax considerations to all options transactions, the customer considering options should consult their tax advisor as to how taxes affect the outcome of each options strategy. All company analysis information is provided by third parties and not by Moomoo Financial Inc. Any illustrations, scenarios, or specific securities referenced herein are strictly for informational purposes and is not a recommendation. Past investment performance does not guarantee future results. Investing involves risk and the potential to lose principal. This content is also not a research report and is not intended to serve as the basis for any investment decision. The information contained in this article does not purport to be a complete description of the securities, markets, or developments referred to in this material. The information has been obtained from sources considered to be reliable, but we do not guarantee that the foregoing material is accurate or complete. Furthermore, there is no guarantee that any statements, estimates, price targets, opinions or forecasts provided herein will prove to be correct.
Options trading entails significant risk and is not appropriate for all customers. It is important that investors read Characteristics and Risks of Standardized Options before engaging in any options trading strategies. Options transactions are often complex and may involve the potential of losing the entire investment in a relatively short period of time. Certain complex options strategies carry additional risk, including the potential for losses that may exceed the original investment amount. Supporting documentation for any claims, if applicable, will be furnished upon request. Moomoo does not guarantee favorable investment outcomes. The past performance of a security or financial product does not guarantee future results or returns. Customers should consider their investment objectives and risks carefully before investing in options. Because of the importance of tax considerations to all options transactions, the customer considering options should consult their tax advisor as to how taxes affect the outcome of each options strategy. All company analysis information is provided by third parties and not by Moomoo Financial Inc. Any illustrations, scenarios, or specific securities referenced herein are strictly for informational purposes and is not a recommendation. Past investment performance does not guarantee future results. Investing involves risk and the potential to lose principal. This content is also not a research report and is not intended to serve as the basis for any investment decision. The information contained in this article does not purport to be a complete description of the securities, markets, or developments referred to in this material. The information has been obtained from sources considered to be reliable, but we do not guarantee that the foregoing material is accurate or complete. Furthermore, there is no guarantee that any statements, estimates, price targets, opinions or forecasts provided herein will prove to be correct.
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Moomoo Senior News and Community Manager
Former editor at Bloomberg, then Lazard Asset Management. Posts aren’t investment advice. Views are just mine.
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