1 00:00:01,280 --> 00:00:03,520 Speaker 1: This episode is brought to you by P and C Bank. 2 00:00:03,920 --> 00:00:06,680 Speaker 1: A lot of people think podcasts about work are boring, 3 00:00:06,880 --> 00:00:10,719 Speaker 1: and sure they definitely can be, but understanding of professional's 4 00:00:10,800 --> 00:00:14,080 Speaker 1: routine shows us how they achieve their success little by little, 5 00:00:14,440 --> 00:00:18,079 Speaker 1: day after day. It's like banking with P and C Bank. 6 00:00:18,560 --> 00:00:21,360 Speaker 1: It might seem boring to safe plan and make calculated 7 00:00:21,400 --> 00:00:24,479 Speaker 1: decisions with your bank, but keeping your money boring is 8 00:00:24,520 --> 00:00:27,840 Speaker 1: what helps you live a more happily fulfilled life. P 9 00:00:27,960 --> 00:00:32,800 Speaker 1: and C Bank Brilliantly Boring since eighteen sixty five. Brilliantly 10 00:00:32,840 --> 00:00:35,479 Speaker 1: Boring since eighteen sixty five is a service mark of 11 00:00:35,520 --> 00:00:38,760 Speaker 1: the PNC Financial Service Group, Inc. P and C Bank 12 00:00:39,159 --> 00:00:41,360 Speaker 1: National Association Member FDIC. 13 00:00:43,440 --> 00:00:47,839 Speaker 2: Talking about a stock pullback, let's talk about Oracle. We 14 00:00:48,080 --> 00:00:51,800 Speaker 2: talked about it a little bit last week, but Oracle still, 15 00:00:52,400 --> 00:00:55,000 Speaker 2: you know, fighting its way out of its pullback. 16 00:00:56,720 --> 00:01:01,280 Speaker 3: Is now the time to buy Oracle? I don't think so. 17 00:01:02,200 --> 00:01:03,840 Speaker 4: Stock Club put in chat if I can put it 18 00:01:03,840 --> 00:01:08,040 Speaker 4: in one of the prices, I think. 19 00:01:10,080 --> 00:01:11,240 Speaker 3: You definitely need to wait to. 20 00:01:13,000 --> 00:01:17,800 Speaker 4: One at least one sixty before you're willing to pull 21 00:01:17,840 --> 00:01:22,000 Speaker 4: the trigger. If you look at the Fibonacci from the 22 00:01:22,040 --> 00:01:24,920 Speaker 4: all time high, over the last five years. Is underneath 23 00:01:24,920 --> 00:01:27,920 Speaker 4: that fifty percent marks two or two seventy three. That's 24 00:01:28,000 --> 00:01:30,200 Speaker 4: usually not a good sign. But there is a place 25 00:01:30,200 --> 00:01:34,120 Speaker 4: where it's sitting where there is some signs true. I 26 00:01:34,160 --> 00:01:35,480 Speaker 4: don't know if you want to queue it up, but 27 00:01:35,520 --> 00:01:38,360 Speaker 4: there is a place that I do like to start 28 00:01:38,400 --> 00:01:42,039 Speaker 4: to look to buy an asset. One thing I will say, though, 29 00:01:43,000 --> 00:01:45,120 Speaker 4: we have to stop looking for companies to give in 30 00:01:45,319 --> 00:01:49,080 Speaker 4: Vidia like returns that are not in video, because then 31 00:01:49,120 --> 00:01:51,880 Speaker 4: even in video aren't going to be going to be 32 00:01:51,920 --> 00:01:53,800 Speaker 4: able to give those returns that they've had since twenty 33 00:01:53,800 --> 00:01:56,680 Speaker 4: twenty one. It's a different market, it's a different climate. 34 00:01:58,040 --> 00:02:01,160 Speaker 4: The truth about the economy is coming up out a 35 00:02:01,160 --> 00:02:03,600 Speaker 4: lot faster. People are starting to brace for a recession, 36 00:02:04,040 --> 00:02:07,920 Speaker 4: and risk is all for most hedge funds. So if 37 00:02:07,920 --> 00:02:09,160 Speaker 4: you like it, you have to like it at the 38 00:02:09,200 --> 00:02:12,280 Speaker 4: right price. But if it's really at its fair value 39 00:02:13,120 --> 00:02:14,400 Speaker 4: price for where it should be. 40 00:02:16,000 --> 00:02:17,079 Speaker 3: But I would definitely wait for. 41 00:02:17,040 --> 00:02:21,679 Speaker 4: Like that one sixty area to start to acquire equities 42 00:02:21,720 --> 00:02:22,480 Speaker 4: and in this company. 43 00:02:22,800 --> 00:02:25,840 Speaker 1: Yeah, I'll start by saying this, and this is important 44 00:02:25,840 --> 00:02:29,560 Speaker 1: to know. Cloud profitability is future dated, right, So if 45 00:02:29,600 --> 00:02:32,440 Speaker 1: you're writing notes, write that down in your notes. Cloud 46 00:02:32,680 --> 00:02:36,640 Speaker 1: profitability is future dated, meaning that there's going to be 47 00:02:36,680 --> 00:02:39,000 Speaker 1: profits down the road, but it takes time. 48 00:02:39,120 --> 00:02:40,680 Speaker 3: And so what happened to Oracle. 49 00:02:41,720 --> 00:02:44,760 Speaker 1: Yes, we've talked about the investment that they've made, and 50 00:02:45,000 --> 00:02:47,240 Speaker 1: the idea is if you build it, they will come. 51 00:02:47,919 --> 00:02:50,480 Speaker 1: The reality is that you have to build it, and 52 00:02:50,560 --> 00:02:52,880 Speaker 1: the problem that people are seeing is that the cost 53 00:02:52,960 --> 00:02:55,720 Speaker 1: that it's going to take to build is really strenuous 54 00:02:55,760 --> 00:03:00,359 Speaker 1: on its capex, which is interesting because that it feels 55 00:03:00,360 --> 00:03:02,399 Speaker 1: like a natural thing. If we're going to spend more 56 00:03:02,520 --> 00:03:04,679 Speaker 1: to make more, that we need that time period to 57 00:03:04,720 --> 00:03:07,000 Speaker 1: do it. The problem is that their cloud service in 58 00:03:07,040 --> 00:03:10,799 Speaker 1: the immediate standpoint was growing, and so what did I say. 59 00:03:10,800 --> 00:03:11,359 Speaker 3: I wanted to see. 60 00:03:11,360 --> 00:03:13,080 Speaker 1: I wanted to see if the cloud business was continued 61 00:03:13,120 --> 00:03:16,120 Speaker 1: to growing, to continue to grow, and it did, right, 62 00:03:16,120 --> 00:03:18,839 Speaker 1: they add a new customers, the crowd business went from 63 00:03:19,080 --> 00:03:22,160 Speaker 1: I think thirty two percent up to thirty nine percent 64 00:03:22,160 --> 00:03:22,920 Speaker 1: of forty percent. 65 00:03:23,320 --> 00:03:24,040 Speaker 3: That's a good sign. 66 00:03:24,480 --> 00:03:28,160 Speaker 1: So I start studying who else in the cloud service 67 00:03:28,200 --> 00:03:30,239 Speaker 1: business has had this type of run. 68 00:03:30,520 --> 00:03:32,160 Speaker 3: Right, So we got to go back to the pioneer 69 00:03:32,160 --> 00:03:32,600 Speaker 3: of all this. 70 00:03:32,720 --> 00:03:34,480 Speaker 1: Right, when we talk about cloud service, it starts with 71 00:03:34,520 --> 00:03:38,040 Speaker 1: AWS in two thousand and six. In two thousand and six, 72 00:03:38,440 --> 00:03:41,240 Speaker 1: people were not talking about cloud. In fact, they weren't 73 00:03:41,240 --> 00:03:43,640 Speaker 1: even worrying about the profitability because that was not the 74 00:03:43,680 --> 00:03:46,400 Speaker 1: core focus of Amazon's business. Right, this is an e 75 00:03:46,400 --> 00:03:51,080 Speaker 1: commerce thing. They add this as a derivative to their portfolio. 76 00:03:51,840 --> 00:03:54,920 Speaker 1: Ten years down the line. Now AWS is the thing 77 00:03:54,920 --> 00:03:57,640 Speaker 1: that we know it and it's profitable. Two thousand and eight. 78 00:03:57,800 --> 00:04:00,800 Speaker 1: Amazon season not Google sees the same. Right, they watched 79 00:04:00,800 --> 00:04:03,960 Speaker 1: what Amazon did. They created Google Cloud, same thing. Right, 80 00:04:04,000 --> 00:04:06,680 Speaker 1: we got to pioneer with AWS, We got the technology, 81 00:04:06,960 --> 00:04:09,280 Speaker 1: and they led into adaption into the Google space. Now 82 00:04:09,320 --> 00:04:12,520 Speaker 1: that becomes a revenue for them six years down the line. 83 00:04:12,600 --> 00:04:14,720 Speaker 1: So now we're talking to twenty sixteen, we're starting to 84 00:04:14,720 --> 00:04:18,080 Speaker 1: see profitability. Oracle just turned over to a cloud business 85 00:04:18,080 --> 00:04:20,760 Speaker 1: in twenty eighteen, So we're right in that that frame 86 00:04:21,360 --> 00:04:23,680 Speaker 1: here of where are we going to see profitability from it? 87 00:04:23,800 --> 00:04:25,680 Speaker 1: It just so happens that it's coming at the same 88 00:04:25,720 --> 00:04:27,920 Speaker 1: time as a CAPEC spin. I'm going to give you 89 00:04:27,960 --> 00:04:30,239 Speaker 1: another company, and I'm gonna tell you what the report 90 00:04:30,279 --> 00:04:34,960 Speaker 1: said inside the cloud space. This company, the cloud business 91 00:04:35,000 --> 00:04:37,320 Speaker 1: was growing fast, but it wasn't yet dominant. We already 92 00:04:37,360 --> 00:04:39,760 Speaker 1: know that Oracle is number four in the space, right, 93 00:04:39,839 --> 00:04:42,680 Speaker 1: we talked about the other other three. This company, they 94 00:04:42,680 --> 00:04:46,640 Speaker 1: said that they had a heavy cloud capex depressing their margins, right, 95 00:04:46,680 --> 00:04:48,640 Speaker 1: so the amount of money they were spending, the margins 96 00:04:48,680 --> 00:04:49,360 Speaker 1: were getting dinner. 97 00:04:49,400 --> 00:04:50,360 Speaker 3: How are we going to pay for this? 98 00:04:50,880 --> 00:04:53,599 Speaker 1: They said their software still was the core profit engine, 99 00:04:53,680 --> 00:04:56,560 Speaker 1: very similar to Oracle. They also said that their market 100 00:04:56,800 --> 00:04:59,560 Speaker 1: was unsure if the company could really pivot from being 101 00:04:59,600 --> 00:05:01,719 Speaker 1: a software where to a cloud service. You know what 102 00:05:01,720 --> 00:05:07,720 Speaker 1: that company's name was, which one absorbed by Microsoft. Now 103 00:05:07,720 --> 00:05:09,680 Speaker 1: if we look at it today, it's number three in 104 00:05:09,680 --> 00:05:11,880 Speaker 1: the cloud space. And so when I'm telling you that 105 00:05:12,560 --> 00:05:15,600 Speaker 1: profitability takes time and it's future dated, that's what we're 106 00:05:15,600 --> 00:05:18,960 Speaker 1: saying here. The issue here is obviously AI in the 107 00:05:19,000 --> 00:05:21,640 Speaker 1: mix of all of this, right, and so now when 108 00:05:21,640 --> 00:05:24,400 Speaker 1: we look at Oracle, it's like, hey, they've reinvented themselves 109 00:05:24,440 --> 00:05:27,480 Speaker 1: a few times already. They started out as enterprise software. 110 00:05:27,920 --> 00:05:31,080 Speaker 1: They went from enterprise software to subscriptions. Now they're going 111 00:05:31,080 --> 00:05:34,440 Speaker 1: from subscriptions right in that AI software to now cloud 112 00:05:34,440 --> 00:05:37,360 Speaker 1: service and obviously everything comes to the AI. It's going 113 00:05:37,400 --> 00:05:40,760 Speaker 1: to take time. Are they at the prime place? Well, 114 00:05:40,920 --> 00:05:43,040 Speaker 1: There's this guy listened to every Monday. His name is 115 00:05:43,080 --> 00:05:46,120 Speaker 1: Ian Dunlap. He talks about this moving average for the 116 00:05:46,160 --> 00:05:51,640 Speaker 1: four hundred day moving average. Ian Oracle is sitting at 117 00:05:51,680 --> 00:05:56,160 Speaker 1: one three eighty two. That is representation of. 118 00:05:56,160 --> 00:06:01,239 Speaker 3: What give them my levels at the market. 119 00:06:03,640 --> 00:06:08,680 Speaker 1: It is currently at it's four hundred day e m A, 120 00:06:09,400 --> 00:06:11,680 Speaker 1: which is a sign. And I'll leave it at that 121 00:06:11,800 --> 00:06:16,520 Speaker 1: if you know, you know, But Oracle is not going anywhere. 122 00:06:17,200 --> 00:06:19,440 Speaker 1: The cloud space is going to be a space that 123 00:06:19,480 --> 00:06:22,240 Speaker 1: they're going to play a part in. Obviously they are 124 00:06:22,320 --> 00:06:26,080 Speaker 1: number four UH in the United States five globally. But 125 00:06:26,160 --> 00:06:29,400 Speaker 1: I think were what's happening is now you're starting to 126 00:06:29,400 --> 00:06:31,520 Speaker 1: see the sediment changed. The same way we talked about 127 00:06:31,560 --> 00:06:34,520 Speaker 1: the positive sediment when we're talking about Tesla and Eli Musk, 128 00:06:34,760 --> 00:06:38,320 Speaker 1: you're seeing negative sentiment around Oracle. You've see credit, the 129 00:06:38,440 --> 00:06:42,600 Speaker 1: false swaps, I mean the credit the false which is crazy, 130 00:06:42,960 --> 00:06:45,239 Speaker 1: have spiked through the roof, meaning people are saying, look, 131 00:06:45,720 --> 00:06:47,640 Speaker 1: we're gonna bet that if they can't pay. 132 00:06:47,480 --> 00:06:49,400 Speaker 3: It right, we need to make money off of it. 133 00:06:49,480 --> 00:06:52,520 Speaker 1: We're betting on them not outside, they're betting on them 134 00:06:52,600 --> 00:06:55,719 Speaker 1: not being able to pay this off. I think that's 135 00:06:55,800 --> 00:06:57,920 Speaker 1: interesting and people are making money off that. In the 136 00:06:57,960 --> 00:07:00,520 Speaker 1: short term, I think this is oracle be to stay. 137 00:07:00,640 --> 00:07:04,400 Speaker 1: You're talking about the third or fourth wealth wealthiest person 138 00:07:04,440 --> 00:07:07,200 Speaker 1: in the world. When we're talking about Larry Ellison, obviously 139 00:07:07,200 --> 00:07:08,440 Speaker 1: he has government backing. 140 00:07:08,200 --> 00:07:08,920 Speaker 3: On his side. 141 00:07:09,560 --> 00:07:12,440 Speaker 1: This will this will turn around. But it's an interesting 142 00:07:12,440 --> 00:07:13,360 Speaker 1: point right now that it's out. 143 00:07:13,600 --> 00:07:15,080 Speaker 3: Can I play Devil's advocate real quick? 144 00:07:15,120 --> 00:07:18,720 Speaker 4: Will people be so pro oracle if he didn't have 145 00:07:18,760 --> 00:07:25,600 Speaker 4: Trump in his back pocket? Because prior to him getting in, Yeah, 146 00:07:27,160 --> 00:07:30,080 Speaker 4: most people weren't not looking at. 147 00:07:30,000 --> 00:07:33,000 Speaker 3: Larry in the way that he should be revered. But 148 00:07:33,040 --> 00:07:35,119 Speaker 3: the stock was not a tech darling. 149 00:07:35,920 --> 00:07:39,360 Speaker 1: You're right, and I think yes, I'm going to say yes, 150 00:07:39,640 --> 00:07:42,360 Speaker 1: And I'm not saying because of this administration. Right, I'm 151 00:07:42,360 --> 00:07:45,400 Speaker 1: thinking when he was president last time, So when he 152 00:07:45,480 --> 00:07:48,600 Speaker 1: was forty five, the tea leaves were there. Right when 153 00:07:48,600 --> 00:07:52,960 Speaker 1: we're talking about who's getting cloud contracts from the government, 154 00:07:53,440 --> 00:07:56,320 Speaker 1: who's making the tik tok fiasco, who's going to be 155 00:07:56,360 --> 00:07:59,160 Speaker 1: the cloud server for them, that's worked in this favor. Obviously, 156 00:07:59,160 --> 00:08:02,000 Speaker 1: now when we're talking about opening Eye and Stargate, that's 157 00:08:02,040 --> 00:08:04,960 Speaker 1: worked in his favor. So is he a huge donor 158 00:08:05,040 --> 00:08:10,440 Speaker 1: of that campaign one thousand percent. Have we seen a 159 00:08:10,480 --> 00:08:13,120 Speaker 1: clear pattern of how he makes sure that the people 160 00:08:13,160 --> 00:08:15,720 Speaker 1: that are closest to him and take care of him 161 00:08:15,880 --> 00:08:18,680 Speaker 1: are being taken care of earners. 162 00:08:18,680 --> 00:08:19,080 Speaker 3: What's up? 163 00:08:19,160 --> 00:08:21,640 Speaker 1: You ever walk into a small business and everything just 164 00:08:21,800 --> 00:08:24,960 Speaker 1: works like the checkout is fast, their seats are digital, 165 00:08:25,480 --> 00:08:28,480 Speaker 1: tipping is a breeze, and you're out the door before 166 00:08:28,480 --> 00:08:32,640 Speaker 1: the line even builds. Odds are they're using Square. 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