Harding Loevner Global Equity Strategy's Views on Oracle (ORCL)

Harding Loevner, an asset management company, released its “Global Equity Strategy” third-quarter 2025 investor letter.  A copy of the letter can be downloaded here. The fund returned 2.62% gross (2.52% net) in the third quarter of 2025, compared to a 7.74% return for the MSCI All Country World Index and 7.36% gain for the MSCI World Index. YTD, the strategy rose 10.61% (net) compared to 18.86% and 17.83% for the indexes. The firm highlighted in the letter that the last six months represented one of the strongest momentum phases in over 70 years. Since the beginning of the year, high-momentum stocks have outperformed low-momentum stocks by a remarkable 45 percentage points, with much of the growth driven by advancements in AI. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its third-quarter 2025 investor letter, Harding Loevner Global Equity Strategy highlighted stocks such as Oracle Corporation (NYSE:ORCL). Oracle Corporation (NYSE:ORCL) offers products and services that address enterprise information technology environments. The one-month return of Oracle Corporation (NYSE:ORCL) was -10.42%, and its shares gained 11.81% of their value over the last 52 weeks. On December 04, 2025, Oracle Corporation (NYSE:ORCL) stock closed at $214.33 per share, with a market capitalization of $611.01 billion.

Harding Loevner Global Equity Strategy stated the following regarding Oracle Corporation (NYSE:ORCL) in its third quarter 2025 investor letter:

"Al, in our view, is a real secular change that is going to reshape Industries. But it also represents a broad source of uncertainty in today's markets. Its impact could be incremental or profoundly disruptive, and that breadth of possibilities leaves historical company fundamentals as a less reliable guide to long-term future value. Markets have instead leaned on narratives, rewarding companies perceived as central to the buildout of Al and penalizing those that don't fit the story. Oracle Corporation (NYSE:ORCL), a stock we don't hold, and The Tradesk, one that we do, highlight the divergence.

Oracle is a mature enterprise-software and cloud-services provider whose shares were lagging this year, until a detail in its most recent earnings report instantly shifted the market's perception of the business. Remaining performance obligations, or the company's order backlog, grew nearly 360% from a year ago to US$455 billion, as customers look to secure access to cloud-computing services to support their Al needs. Oracle's stock surged 36% on September 10, its largest single-day gain since 1992 (when its market capitalization was a fraction of the size that it is today). News reports later revealed that a US$300 billion commitment from OpenAI represents the majority of the order backlog. OpenAI's products may be at the center of the Al transition, but it's still a private startup that is projected to generate only US$13 billion in revenues this year and has ongoing losses. Therefore, fulfilling its commitment to Oracle (and others with which it has struck similar agreements) likely hinges on its ability to raise a substantial portion of the money, a risk that oddly didn't seem to faze markets."

Oracle Corporation (NYSE:ORCL) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 122 hedge fund portfolios held Oracle Corporation (NYSE:ORCL) at the end of the third quarter, which was 124 in the previous quarter. While we acknowledge the potential of Oracle Corporation (NYSE: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.

In another article, we covered Oracle Corporation (NYSE:ORCL) and shared the list of AI stocks analysts are tracking closely. In addition, please check out our hedge fund investor letters Q3 2025 page for more investor letters from hedge funds and other leading investors.

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