Insider Buying

Insider Buying Report: Oracle Corp (ORCL:US)

Oracle Corp
(ORCL:US)
12 months:
+32%
Activity:
Bullish
Pattern:
Purchase from a director
News:
Q2 results
Oracle Corp
(ORCL:US)
12 months:
+32%
Activity:
Bullish
Pattern:
Purchase from a director
News:
Q2 results

Corporate executives and directors tend to have superior information in relation to their firms’ operating activities. If these insiders are buying company stock, it’s generally a bullish signal.

Here, we are going to highlight an insider trade at Oracle Corp (ORCL:US). Oracle is a multinational computer technology company that is headquartered in the US. The company sells database software and technology, cloud computing services, and enterprise software products such as client relationship management software. The majority of the software it sells is under its own brands. It’s traded on the New York Stock Exchange and currently has a market capitalization of $212 billion.

Oracle Corp: Insider Buying

Our data shows that on January 20, a Director at Oracle, Charles Moorman, purchased 15,000 ORCL shares at a price of $83.76 per share. This purchase cost the insider around $1.3 million and increased his holding by around 50%.

The graph represents Oracle Corp' price history, with significant buy and sell events highlighted.

Large Transaction

This insider transaction caught our attention for two main reasons.

Firstly, this is a large purchase of stock in monetary terms which indicates that the director is very confident in the future prospects of Oracle. He is upping his stake by a significant percentage too, which makes us believe that he thinks that the shares are undervalued at current levels.

Secondly, Mr. Moorman is an experienced businessman who has served as CEO of a number of companies including Amtrak and Norfolk Southern Corporation. Before he became CEO of Norfolk Southern, he spent thirty years working in a number of positions at the company, including working in the information technology team. He is also a director at Chevron Corporation. This background means he is highly likely to be able to spot intrinsic value in a company’s stock.

Impressive Cloud Revenues

Oracle produced a solid set of Q2 numbers that showed that the company is making progress in its cloud division.

For the quarter, revenue moved up 6% year over year to $10.4 billion. Meanwhile, cloud license and on-premise license revenues came in at $1.2 billion, up 13% year on year. Cloud services and license support revenues were up 6% on Q2 2020 at $7.6 billion. Non-GAAP EPS for the period amounted to $1.21, which was $0.10 higher than expected and 14% higher than a year prior.

As a result of these solid results, the board of directors increased the authorization for share repurchases by $10 billion.

“These strong results are being driven by the 22% growth of our infrastructure and applications cloud businesses which are approaching $11 billion in annualized revenue. We now have 8,500 Fusion ERP customers with revenue growing 35%, 28,400 NetSuite ERP customers with revenue growing 29%, and our Gen2 infrastructure businesses are growing even faster—and accelerating,” commented Safra Catz, Oracle’s CEO.

Having looked at these strong Q2 results, we see the recent director buying at Oracle as bullish. The large purchase of stock by Mr. Moorman suggests he strongly believes the share price will continue to rise.

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