Billionaire Tepper Exits Oracle, Quietly Loading Up on a Sector Wall Street Loves

David Tepper’s Appaloosa Management just made a bold move: dumped its entire Oracle position (150,000 shares) in Q3, then quietly stacked millions into regional banks and fintech infrastructure. Here’s what that tells us.

Why Oracle Lost Its Shine

Oracle rode the AI wave hard. September earnings were monster—$455 billion in remaining obligations (up 359% YoY), with OpenAI and other hyperscalers locking in mega data center deals. Stock jumped 40%. But reality hit: margin concerns, higher infrastructure build costs, and AI valuation skepticism sent it retreating. Tepper apparently saw the red flags early.

The Real Play: Financials Sector

While Oracle stumbled, Appaloosa’s Q3 shopping spree tells a different story:

• Fiserv (bank core-processing): 925,000 shares
• Truist Financial: 1.4M shares
• KeyCorp: 2M+ shares
• Citizens Financial, Comerica, Western Alliance, Zions: Millions combined

Yes, the financials sector has lagged the broader market. But here’s the setup: Morgan Stanley’s chief strategist and SoFi’s investment head are both overweight. Why?

Three catalysts brewing:

1. M&A wave incoming — Regional banks need scale. Comerica already got acquired in October (Tepper’s already pocketing gains)
2. Deregulation tailwind — The Fed may slash regulatory capital requirements, unleashing billions in lending power and shareholder payouts
3. Credit quality intact — Unlike 2008, bank balance sheets look solid. Lower capital reqs = more lending deployed

Private credit exploded because banks couldn’t lend. Fix that constraint, watch what happens.

The Tepper Tell

When a guy who averaged 25%+ annual returns for decades exits a hot tech darling and pivots to an unloved sector, markets usually take notice eventually. The financials thesis isn’t sexy—it’s structural.