Oracle Corporation
Thesis
Oracle is an excellent business that is currently out of favor with the market. The company has evolved its revenue model to include a significant recurring revenue stream from Update & Support fees, which has grown substantially over the years. This shift enhances the stability and predictability of Oracle's earnings, making it an attractive investment at current prices around $30.
Did it work?
The long thesis on Oracle at ~$30, premised on its shift toward stable, recurring Update & Support revenue making earnings more predictable and the stock undervalued, was decisively validated: the stock returned +402.8%, implying a price around $150. Such a large gain in the direction of the pitch confirms the market eventually recognized the earnings quality and durability the thesis highlighted. With no stated time horizon or target in the thesis, the magnitude of the return itself is sufficient to call the thesis a success.