Sentiment Shifts on These Beaten Down Stocks: NFLX, ORCL
A few investor-favorite stocks, namely Netflix NFLX and Oracle ORCL, have faced rather tough action over the past six months, with NFLX shares down 22% whereas ORCL shares have seen a 50% decline.
But over the past month, the story has been entirely different, with both seeing nice gains, as shown below.
Image Source: Zacks Investment Research
Sentiment is seemingly shifting on the favorites after the rough stretch, undoubtedly a welcomed development among investors. But what’s been driving the turnaround?
Netflix Drops Bid for WBD
The streaming landscape has grown quite competitive over the years, but Netflix has continued to protect its leading position by implementing several positive measures, such as doubling down on original content, exploring new revenue streams like ad-supported membership tiers, and supporting live sports events.
The company’s shares had been dragged down partly due to its intended acquisition of WBD, but that has since fizzled out, with Netflix declining to raise its offer in the wake of Paramount Skydance’s PSKY interest in acquiring WBD.
In a release, Netflix stated –
‘The transaction we negotiated would have created shareholder value with a clear path to regulatory approval. However, we’ve always been disciplined, and at the price required to match Paramount Skydance’s latest offer, the deal is no longer financially attractive, so we are declining to match the Paramount Skydance bid.’
The announcement of dropping out of the deal caused shares to reverse course entirely, seeing massive gains in the days following. Downward revisions for its current fiscal year during the ‘waiting’ period were also to blame for the poor share performance, but they have since stabilized, as shown below.
Image Source: Zacks Investment Research
Oracle Eases Fears
Oracle is a global technology titan that is evolving from a database powerhouse into a leading architect of the AI era. Sentiment on the stock has been rough since reaching an all-time high in September of 2025 on the back of capital-related concerns stemming from its current data center buildout, but recent quarterly results have helped ease concerns.
Cloud revenues soared 44% to $8.9 billion in USD in its latest release, which was at the high end of its previous guidance. Importantly, its remaining Performance Obligations, or RPO, ended the quarter at $553 billion, up a staggering 325% from the same period last year and up $29 billion from last quarter.
The Cloud revenue growth rate of 44% reflected a big acceleration from the 34% rate we saw in the year-ago period, with Cloud revenues now accounting for more than half of Oracle’s overall sales. The growth acceleration in the cloud and a higher contribution of cloud revenues help underpin its investments, with shares seeing a nice post-earnings reaction as a result.
Sales growth has remained broadly strong for the tech titan, as shown below. Revenue of $17.1 billion throughout the above-mentioned quarter reflected a 21% YoY growth rate, reflecting the strongest growth we’ve seen in years from the company.
Image Source: Zacks Investment Research
Bottom Line
While sentiment on both Netflix NFLX and Oracle ORCL have been rather rough for the better part of the last year, recent developments, such as Netflix dropping its bid for WBD and Oracle posting strong cloud results that help underpin its massive investments, have helped turned the narratives around.
Beyond Nvidia: AI’s Second Wave Is Here
The AI revolution has already minted millionaires. But the stocks everyone knows about aren’t likely to keep delivering the biggest profits. Little-known AI firms tackling the world’s biggest problems may be more lucrative in the coming months and years.
Netflix, Inc. (NFLX) : Free Stock Analysis Report
Oracle Corporation (ORCL) : Free Stock Analysis Report
Paramount Skydance Corporation (PSKY) : Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
Discover more from stock updates now
Subscribe to get the latest posts sent to your email.
