These 2 Stocks Are About To Report Earnings This Week!
In a Nutshell
Oracle and Adobe both report earnings Thursday, with Oracle offering 55% upside but 27% downside risk on a miss, while Adobe trades at a cheap 14.7x PE with 69% fair value upside yet remains trapped in a descending trend. Oracle faces severe capital strain from $227B in AI data center funding needs, requiring $40B in new debt/equity raises including $20B in dilution, while Adobe's consistent earnings beats have repeatedly triggered post-report selloffs. September's historically weak seasonality combined with CPI/PPI data this week creates elevated downside risk for both names ahead of the Fed decision.
These notes were generated by AI and may contain inaccuracies.
Happy Labor Day everyone. Oracle and Adobe are reporting earnings on Thursday. Both stocks show similar patterns on the daily chart, performing well early to mid-2025. Oracle reached highs of 341 while Adobe has been struggling more significantly.
Adobe had its run-up during the post-pandemic rally, then sold off and retested previous highs in early 2024 before declining since then. Both companies are selling off for different reasons but are technically attempting to rebound currently. Oracle has recovered approximately 40% from its July 28th lows, though it has been selling off throughout 2026 with a brief upswing during the AI market recovery before sharply declining again.
Oracle has recovered about 40% from recent lows, but a worse-than-expected earnings report could result in 27% downside based on previous lows. Based on recent highs, Oracle offers approximately 55% upside potential. The question remains whether to buy these stocks ahead of earnings or if the risk is too high.
Adobe has been more consistently bearish. From recent lows of 190 to current highs, Adobe shows a 37% bounce. The stock achieved a 51% gain in 73 days from its recent lows to highs reached just a few days ago. Adobe is at a critical technical point, unable to break above the strong descending lower high and lower low pattern.
According to fair value analysis, Adobe shows 69% upside potential based on earnings expectations. The company has consistently exceeded market expectations, though post-earnings reactions have more often been negative. Current earnings expectations are $6 EPS and $6.69 billion in revenue.
Adobe trades at a 14.7x PE ratio, which appears to be a fair valuation. The company generates $25 billion in annual revenue with $7.2 billion in net income. Revenue growth has been consistent quarter after quarter.
Morgan Stanley has downgraded Adobe, with current market concerns affecting sentiment for the stock. The bear case needs consideration alongside the bull case.
Oracle shows 16.9% upside potential according to fair value analysis, trading at 26.9x earnings. The company has $67 billion in revenue and $17 billion in net income. Despite these fundamentals, significant concerns exist around the $227 billion funding gap as AI data center investment erodes asset efficiency.
Oracle is aggressively leveraged, using substantial margin and burning through capital. Gross margins declined in 2026 due to data center cost ramp-ups, with further step-downs guided for 2027. Margin recovery depends on data centers reaching full contractual revenue capacity, making execution outcomes uncertain.
Oracle plans to raise $40 billion in debt and equity, including $20 billion through at-the-market equity issuance, raising dilution concerns for current investors. This follows the pattern seen with MicroStrategy where frequent capital raises signal potential underlying issues.
September historically remains one of the toughest months for stocks, particularly this week with final inflation data before the FOMC rate decision. Current Fed rate monitor shows 58% probability of Federal Reserve rate hikes. Hotter-than-expected inflation data this week would increase this probability, likely pressuring markets lower.
Neither Oracle nor Adobe have been among the best performing stocks for 2026 despite the Nasdaq and S&P 500 trading near all-time highs. Stocks that struggled during a bullish market may face additional pressure if broader markets begin to pull back.
CPI data reports on Friday and PPI data reports on Thursday. These inflation reports will provide critical information about the current inflation environment ahead of Federal Reserve policy decisions.
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