The debt behind Oracle's capex is drawing credit-market concern. Its five-year credit-default swap spread has risen past 300 basis points. x.com 

Oracle's credit risk is hard to dismiss when its CDS prices a roughly one-in-four risk-neutral chance of default sometime in the next five years. x.com 

Oracle's debt risk is already largely priced in after the stock fell 43.64% over the past year and 56.1% from its all-time high, which is why its credit default swaps exploded. That makes now a questionable time for Michael Burry to go short. x.com 

Oracle's stock is ignoring nervous credit desks, which is not a good sign. Per @CheddarFlow, Oracle's credit risk has skyrocketed, yet the shares still trade as if it isn't happening. x.com 

Oracle is heading for a crash toward a $70 target as it rejects its monthly 50-period moving average from below. The biggest crashes come when a stock breaks its weekly 200-period and monthly 50-period averages, retests them from below and fails. Credit backs this up: Oracle leaned on cheap debt until its CDS hit levels unseen since 2009 and it was cut to one notch above junk, then announced about $20 billion of equity issuance anyway with shares 50% off their highs. x.com  x.com 

Oracle is worth accumulating because demand for its products keeps growing, as its backlog shows, and the AI revolution has years left. Its services are used by a large share of Fortune 500 companies, and betting against Larry Ellison is unwise. The situation is messy: Ellison pledged 36% of his Oracle holdings, $9.2B, as loan collateral, Oracle invoked force majeure on its own data center while insisting it is on schedule, and the stock can still fall further. x.com  x.com 

Oracle's heavy AI infrastructure debt poses a further credit risk: if downgraded, an estimated $120B of bonds could leave investment-grade indexes and push borrowing costs higher. Its reported 215-bp CDS spread signals stress; CoreWeave's debt rating looks better by comparison. x.com  x.com 

Oracle's debt could implode, leaving shareholders exposed to severe losses. Its five-year CDS is at 261 basis points, above its 2008 highs; the perceived chance of its debt imploding has gone from zero to something higher. CDS alone is not a meaningful signal to increase or reduce exposure. x.com  x.com 

Oracle looks mispriced because $11 of current consolidated earnings power puts it at 11x earnings without a breakup. It trades below its software business's value despite the highest gross retention in software; separating pre-AI OCI, AI operations and AI development makes it an obvious long. Future funding will cost more, but current leverage is no issue and all contracts are well below spot, leaving nowhere near neocloud risk. Fundamentals may not matter during panics. x.com  x.com  x.com 

Oracle's credit is the load-bearing stress point in AI: its five-year CDS hit 203bp, an 18-year high, after S&P cut it to one notch above junk. S&P cited -$23.7 billion of free cash flow, about $130 billion of debt and a projected $42 billion deficit. Oracle CDS is now the referendum on whether AI debt gets repaid, and the odds of an autumn crash, which would hit OpenAI-dependent names first, are near one in three. CDS through 250 or a 30-year close above 5.30 tilts the odds darker. x.com  x.com