Here's Why ​Oracle Corporation (ORCL) Has Fallen More Than 39% in 2 Months

​Oracle Corporation (NYSE:ORCL) is one of the Best Cloud Stocks to Buy Now. Oracle Corporation (NYSE:ORCL) has fallen more than 39% over the past 2 months due the concerns of a growing AI bubble. However, despite the rising concerns, on November 18, Robert Oliver from Robert W. Braid reiterated a Buy rating on the stock, but lowered the price target from $365 to $315. Earlier on November 17, Brent Thill from Jefferies had also reiterated a Buy rating on the stock with a $400 price target.

While the stock price started to fall heavily after the company on September 22 announced replacement of longtime CEO Safra Catz with Clay Magouyrk and Mike Sicilia, the AI valuation concerns have been lingering for years. Oracle Corporation (NYSE:ORCL) came under the spotlight after it raised $18 billion in debt last month, taking its total debt to over $100 billion.

​As a result, traders have recently been hedging the company’s credit-default swaps. On November 20, Bloomberg reported that the price of Oracle Corporation’s (NYSE:ORCL) 5-year CDS has tripled and now costs around $111,000 per year to protect $10 million of the company’s debt from default over five years.

​In addition, according to a November 13 report by CNBC, analyst Jackson Ader from KeyBanc Capital Markets, who has a Buy rating on Oracle Corporation (NYSE:ORCL) with a $350 price target, noted “AI sentiment is waning.” He also added, “We struggle to see an avenue for ORCL’s credit trajectory to improve.”

​Oracle Corporation (NYSE:ORCL) provides cloud-based suites of applications and secure, automated infrastructure through its Oracle Cloud Platform.

While we acknowledge the potential of ORCL as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.