Oracle shares have fallen 53.84% over the past year, yet 80% of covering analysts still rate the stock a buy, with a median target 78.48% above the current price, according to CNN. The article notes revenue grew almost a third in the latest quarter and earnings grew faster, though that does not explain the drop. Analysts are weighing contracts to supply computing capacity worth $638 billion, far above annual revenue, while the market is focused on cash flow: capital spending of $75.66 billion over the past year exceeded $46.94 billion of operating cash, a gap funded by borrowing. The article frames the core question as whether returns on this spending arrive before the debt becomes a problem. The shares trade at 17.76 times expected next-year earnings.
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