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Oracle spikes up 21% following TikTok ‘win’: Where next?

Shares of Oracle Corporation (NYSE: ORCL) spiked up 21% on Monday 14 September 2020, following reports that it has won the bid for TikTok’s US operations. The Oracle stock hit a high of US$64.60 a share in pre-market trading on the IG platform.

  • Oracle shares rallied as much as 21% on Monday
  • The Wall Street Journal reported it will be named TikTok US’ ‘trusted tech partner’
  • This news follows last week’s better-than-expected Q1 2020 earnings
  • Analysts say Oracle still ‘underperforms peers’ in growth figures

Oracle stock rallies 21% in pre-market trading

Shares of Oracle Corporation (NYSE: ORCL) spiked up 21% on Monday 14 September 2020, following reports that it has won the bid for TikTok’s US operations.

The Oracle stock hit a high of US$64.60 a share in pre-market trading on the IG platform.

According to The Wall Street Journal, Oracle will be announced by the Chinese social media app as its ‘trusted tech partner’ in the US, with the deal likely not to be structured as an outright sale.

Microsoft said earlier on Sunday 13 September 2020 that its bid has been rejected by TikTok’s parent company ByteDance.

Following the reports, Bloomberg Intelligence analysts Anurag Rana and Gili Naftalovich wrote in a note that Oracle’s potential TikTok win ‘could provide a minor boost to its cloud infrastructure services’.

However, they noted that Oracle ‘has a long way to go before it becomes even a top-five player in the (cloud infrastructure) space, given its late entry’ into a market currently dominated by Amazon and Microsoft.

As previously reported, Red Pulse analysts had remarked that ‘Oracle has several qualities that may allow it to succeed in the TikTok’s acquisition, outbidding Microsoft and Twitter’.

Oracle had a better-than-expected Q1

Last week, the Oracle stock rallied as much as 8% after its financial results for the August 2020-ending quarter came in better than expected.

The company reported a 2% year-on-year growth in revenues to US$9.4 billion, and 16% annual jump in GAAP (unadjusted) earnings per share (EPS) of US$0.72.

These results beat Wall Street’s sales and EPS estimates of US$9.19 billion US$0.64 per share by 1.9% and 12.4% respectively.

Oracle’s board of directors also declared a quarterly cash dividend of US$0.24 per share of outstanding common stock, to be paid to shareholders on 22 October 2020.

Oracle CEO Safra Catz said: ‘Our cloud applications businesses continued their rapid revenue growth with Fusion ERP up 33% and NetSuite ERP up 23%. We now have 7,300 Fusion ERP customers and 23,000 NetSuite ERP customers in the Oracle Cloud’.

Catz also noted that the company’s infrastructure business is ‘growing rapidly’, as revenue from Zoom more than doubled from Q4 last year to Q1 this year. Oracle is the video communications platform’s main cloud infrastructure provider.

‘I have a high level of confidence that our revenue will accelerate as we move on past Covid-19,’ she added.

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What is the latest Oracle stock target price?

Across the board, Oracle currently has a majority rating of ‘hold’ from 19 out of 30 Wall Street brokers polled by Bloomberg.

The stock has also received an average 12-month share price target of US$61.03 per share.

This represents an upside of 7.1% from the last official traded price, indicating that the stock is still not at its peak market value.

In terms of specific price estimates, Societe Generale and Bernstein analysts are the most optimistic of the lot, giving Oracle a target price of US$70 in the long run.

Why FDA analysts say Oracle is ‘not a preferred investment’

Meanwhile, FDA analysts wrote that Oracle shares are not among their ‘preferred investment choices’, following the B2B firm’s Q1 earnings release. They priced it at a target of US$66.

The analysts wrote: ‘Oracle’s first-quarter earnings report and guidance for the next quarter reflect a continued pattern of moderate growth that underperforms key peers. Improvement may not show in the coming years.’

They noted that while the company still has strong assets, ‘Oracle’s competitive position has become more vulnerable, due to the structural shift towards cloud computing, rising usage of open source software and intensified competition’.

Additionally, the company has in recent years created substantial value for shareholders by spending large amounts of cash on share buybacks. This approach, the analysts added, has ‘reduced the financial room for initiatives that help to lift growth and bring down longer-term risks’.

How to trade US tech stocks with IG

Are you feeling bullish or bearish on Oracle and other US tech stocks?

Either way you can buy (long) or sell (short) the asset using derivatives like CFDs offered on IG’s industry-leading trading platform in a few easy steps:

  1. Create a live or demo IG Trading Account, or log in to your existing account
  2. Enter <Oracle Corp> in the search bar and select the instrument
  3. Choose your position size
  4. Click on ‘buy’ or ‘sell’ in the deal ticket
  5. Confirm the trade
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Industry News

School4Trading Review – How to Spot Possible Forex Broker Fraud

School4trading Review

School4Trading Review – How to Spot Possible Forex Broker Fraud

In this School4trading Review, we will look at the features of the software, as well as the customer support. First, let us look at the interface. The design is simple and easy to navigate. It also provides a chatbot, which helps you to communicate with the broker. The customer service is warm and inviting, which is a hallmark of a good broker. In contrast, a fraudulent broker will use cold and impersonal customer support to lure people in.

Another problem with the system is that the login process is not always intuitive. You may have to retype your password several times to get in. Then, you may experience difficulties withdrawing your funds or accessing your account. In such cases, you might have to wait for days or even weeks before you can withdraw the money you’ve invested. This is not a good sign. It’s better to choose a different trading platform altogether.

If you’re having trouble logging in, you should also check the legitimacy of the broker. Whether the broker is licensed by a reliable regulatory body or closed down, you’ll want to be sure it’s legitimate. If the broker isn’t licensed by the right body, don’t trust him. You shouldn’t waste your time with an inexperienced company. This will only cause you problems in the long run.

The next factor that should be checked is the licensing. A legitimate broker will have a license from a high regulatory body. However, a broker without a license will be unreliable. Moreover, a reliable regulator will take away the license of a scam broker. As a result, a trustworthy School4Broker/Profittrade review should mention fees, account rules, and contract terms. A scam broker will be unable to operate legally.

Secondly, look for warning signs. The broker should be licensed and regulated by a reliable regulatory body. It should be regulated by a high level. If it doesn’t, it’s a scam. Lastly, it should have a website that lets you easily access your account. Moreover, you should not hesitate to check the contact information. If you find any information that seems suspicious, you should reconsider using the broker.

In summary, Forex trading isn’t easy, but it doesn’t have to be complicated. It’s not as difficult as it seems if you’ve heard about the program. You’ll learn everything about the basics and how to become a professional. But if you’re still unsure about whether this program is right for you, don’t hesitate to contact a school4trading’s website.

The most important thing to remember when it comes to Forex trading is that it’s not easy. While it’s important to have a strong background in trading, there are a number of factors that can affect your success. Having a proper plan is vital in the long run, because you will be trading with real money. And, the platform should be reliable. Otherwise, you’ll end up losing a lot of money.

As we’ve mentioned, Forex is not easy. Investing isn’t something you can do in the comfort of your own home. You need a proven system. There are no free trials, so you’ll have to find a way to do it yourself. This isn’t a scam, and it’s a great way to make money without any help. A Forex system can help you learn the intricacies of the market.

Although the process of learning Forex isn’t an easy one, it’s certainly not impossible. Fortunately, there are many people who are willing to take the time to learn how to trade. But, even the most experienced trader needs to be aware of the risks of the market. While Forex trading isn’t easy, it can be done with the right knowledge. The software’s user-friendly interface is key.

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Daily Financial News

Don’t Count On JPY Correction; Staying Long GBP/JPY

The path of the potential pace of the JPY decline may still be underestimated by markets, which continue trading the JPY long.

While the 10% USDJPY advance from September lows looks impressive from a momentum point of view, it may no thave been driven by Japan’s institutional investors reducing their hedging ratios or Japan’s household sector reestablishing carry trades.

Instead, investors seemed to have been caught on the wrong foot, concerned about a sudden decline of risk appetite or the incoming US administration being focused on trade issues and not on spending. Spending requires funding and indeed the President-elect Trump’s team appears to be focused on funding. Here are a few examples: Reducing corporate taxation may pave the way for US corporates repatriating some of their USD2.6trn accumulated foreign profits. Cutting bank regulation could increase the risk-absorbing capacity within bank balance sheets. Hence, funding conditions – including for the sovereign – might generally ease. De-regulating the oil sector would help the trade balance, slowing the anticipated increase in the US current account deficit. The US current account deficit presently runs at 2.6% of GDP, which is below worrisome levels. Should the incoming government push for early trade restrictions, reaction (including Asian sovereigns reducing their holdings) could increase US funding costs, which runs against the interest of the Trump team.

Instead of counting on risk aversion to stop the JPY depreciation, we expect nominal yield differentials and the Fed moderately hiking rates to unleash capital outflows from Japan.The yield differential argumenthas become more compelling with the BoJ turning into yield curve managers. Via this policy move, rising inflation rates push JPY real rates and yields lower, which will weaken the JPY. Exhibit 12 shows how much Japan’s labor market conditions have tightened. A minor surge in corporate profitability may now be sufficient, pushing Japan wages up and implicity real yields lower.

JPY dynamics are diametrical to last year . Last year, the JGB’s “exhausted”yield curve left the BoJ without a tool to push real yields low enough to adequately address the weakened nominal GDP outlook. JPY remained artificially high at a time when the US opted for sharply lower real yields. USDJPY had to decline, triggering JPY bullish secondround effects via JPY-based financial institutions increasing their FX hedge ratios and Japan’s retail sector cutting its carry trade exposures. Now the opposite seems to be happening. The managed JGB curve suggests rising inflation expectations are driving Japan’s real yield lower. The Fed reluctantly hiking rates may keep risk appetite supported but increase USD hedging costs.Financial institutions reducinghedge ratios and Japan’s household sector piling back into the carry trade could provide secondround JPY weakening effects

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Daily Financial News

Mexico raises interest rates, cites Trump as risk

The head of Mexico’s central bank says U.S. Republican candidate Donald Trump represents a “hurricane” sized threat to Mexico.

Banco de Mexico Gov. Agustin Carstens told the Radio Formula network Friday that a Trump presidency “would be a hurricane and a particularly intense one if he fulfills what he has been saying in his campaign.”

Trump has proposed building a wall along the border and re-negotiating the North American Free Trade Agreement.

Mexico’s central bank raised its prime lending rate by half a percent to 4.75 percent Thursday, citing “nervousness surrounding the possible consequences of the U.S. elections, whose implications for Mexico could be particularly significant.”

Mexico’s peso had lost about 6 percent in value against the dollar since mid-August. It recovered slightly after the rate hike

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