Database software giant Oracle (ORCL) is up 23% over the past year, handily beating the S&P 500, even with its recent pullback. One trader sees more upside into the middle of next year.
That’s based on the June 2026 $165 calls. With 412 days until expiration, 10,500 contracts traded compared to a prior open interest of 198, for a 56-fold rise in volume on the trade. The buyer of the calls paid $14.95 to make the bullish bet.
Oracle shares recently traded for $141, so the stock would need to rise by $24, or 17% for the option to move in-the-money. The strike price of the option is well under Oracle’s 52-week high of $198.31.
The database giant has grown earnings by 22% over the past year, and revenues are up 6%. The company’s shift to subscription-based software services appears to be paying off, and profit margins are now north of 20%.
At current prices, shares trade at about 20 times earnings.
Action to take: Shares are a reasonable value here relative to their growth potential. AI hasn’t gone away despite the volatility of recent weeks and Oracle can likely make another push higher towards its prior highs.
Plus, at current prices, Oracle pays a 1.4% dividend.
For traders, the June 2026 calls have plenty of time to play out, and could easily move deep in-the-money in the months ahead. Less aggressive traders may want to find a shorter strike date, such as September, to play a rebound in markets from their recent low.
Disclosure: The author of this article has no position in the company mentioned here, but may further trade after the next 72 hours. The author receives no compensation from any company mentioned in this article.