Oracle stock has lost 14% of its value since reporting its latest quarterly earnings after Wednesday’s market close.Oracle stock rose 54% that day after reporting a much higher than expected $455 billion contract backlog. However, investors have become less sanguine about the company’s prospects “on concerns about the level of risk Oracle is taking in its build-out,” Oracle’s latest financial report extending investors’ timeline for when the cloud-computing provider will generate a return on its AI build out. The company fell slightly short of analysts’ expectations for revenue and operating income while raising its spending forecast. Oracle stock has meaningful downside risk. The company’s rising debt, negative free cash flow, credit rating pressure, customer concentration, and high valuation premium relative to peers make $ORCL a risky bet. Is Investing in Oracle a risky bet ?
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