Oracle Stock Soars on Cloud Momentum and AI Partnerships

Argus maintains Buy rating on Oracle stock on high demand By Investing.com

Argus, a financial analysis firm, has upgraded its price target for Oracle Corporation (NYSE: NYSE:ORCL) from $159.00 to $176.00 while maintaining a Buy rating on the shares. The firm highlighted Oracle's strong demand exceeding its supply capabilities, prompting the software giant to plan a doubling of its capital expenditures in fiscal year 2025 to better meet customer needs. Oracle's management anticipates double-digit revenue growth in FY25, with cloud revenue now serving as the primary growth driver for the company. The shift comes as traditional license support and hardware revenue streams diminish. Oracle's strategic pivot toward cloud services aligns with the broader trend of enterprise cloud digitization. The company is transitioning away from its traditional on-premise database software to focus on cloud offerings. The company's recent collaborations with leading hyperscale cloud providers have enabled Oracle to offer its customers a variety of computing options. These options include on-premise solutions, Oracle's own cloud services, private clouds, or other public clouds. This flexibility is seen as a scalable advantage that not only caters to diverse customer needs but also helps Oracle defend its significant market share in database software. Argus also commended Oracle for its shareholder-friendly practices, which include robust dividend growth and aggressive share repurchase programs. However, the firm noted that large-scale buybacks are currently not a priority as Oracle aims to strengthen its balance sheet following the acquisition of Cerner (NASDAQ:CERN). In other recent news, Oracle Corporation has made substantial strides in integrating artificial intelligence (AI) into its cloud services. The company's partnership with Uber Technologies Inc . (NYSE:UBER) is a significant development, with Uber leveraging Oracle Cloud Infrastructure (OCI) for over a million hourly trips. The move is part of Uber's strategy to scale operations and accelerate innovation through cloud-based solutions. On the financial front, Oracle's total revenue increased by 8% to $13.3 billion, with cloud product revenue seeing a rise of 21% to $5.6 billion, surpassing analysts' expectations. Analysts from Mizuho Securities, Stifel, and KeyBanc Capital Markets have expressed confidence in Oracle's growth potential. Specifically, KeyBanc Capital Markets has maintained an Overweight rating on Oracle and increased the price target from $165 to $175, following the company's robust performance in Remaining Performance Obligations (RPO). Oracle has also launched several advancements in its services, including the Oracle Cloud Infrastructure (OCI) Generative AI (GenAI) Agents service, a new AI-centric application development infrastructure, termed generative development (GenDev), and new AI capabilities within its Oracle Fusion Data Intelligence suite. Finally, Oracle has been actively collaborating with other cloud service providers, including a recent agreement with Amazon (NASDAQ:AMZN) Web Services. Oracle Corporation's (NYSE:ORCL) recent performance and strategic focus on cloud services have caught the attention of investors and analysts alike. According to InvestingPro data, Oracle has a market capitalization of $429.61 billion, underscoring its prominence in the software industry. The company's Price/Earnings (P/E) ratio stands at 40.17, which is above the industry average, indicating a premium that investors are willing to pay for Oracle's earnings potential. This is further supported by a robust gross profit margin of 71.31% over the last twelve months as of Q1 2023, revealing the company's efficiency in managing its cost of sales relative to revenue. InvestingPro Tips highlight Oracle's consistent shareholder value delivery, with the company raising its dividend for 11 consecutive years. This is a testament to Oracle's financial stability and commitment to returning value to shareholders. Additionally, Oracle's significant returns over the last week, month, and three months suggest strong short-term performance, which may be attractive to investors looking for momentum in the tech sector. For investors seeking more in-depth analysis, there are over 20 additional InvestingPro Tips available, providing a comprehensive view of Oracle's financial health and market position. These tips, along with real-time metrics, can be found at InvestingPro's dedicated Oracle page (https://www.investing.com/pro/ORCL), offering valuable insights for making informed investment decisions.

Mizuho sees double-digit growth for Oracle stock, raises price outlook By Investing.com

On Tuesday, Mizuho maintained a positive outlook on Oracle Corporation (NYSE:ORCL), raising its price target to $185 from the previous $170 while keeping an Outperform rating on the stock. The adjustment follows Oracle's robust first-quarter results, which were particularly bolstered by its cloud infrastructure segment. The company's Remaining Performance Obligations (RPO) saw a significant year-over-year increase of 53%, amounting to $99 billion. Oracle's recent announcement of a partnership with Amazon (NASDAQ:AMZN) Web Services (AWS) has also been a boon, contributing to a 9% rise in its shares after hours. The company's management has confirmed its forecast for double-digit revenue growth for the fiscal year 2025, which surpasses the consensus estimate of 9%. Expectations are set for both total revenue and Oracle Cloud Infrastructure (OCI) revenues to pick up pace in the following quarters. The firm anticipates that Oracle might elevate its mid-term guidance during the Financial Analyst Meeting scheduled for this Thursday. Oracle's extensive range of established infrastructure and application products, its strategy to embrace a multi-cloud environment through partnerships with leading hyperscalers, and the growing demand for artificial intelligence (AI) solutions position it to potentially accelerate its growth trajectory. Oracle is hosting CloudWorld this week in Las Vegas, which, along with the upcoming Financial Analyst Meeting, are seen as potential near-term catalysts for the company's stock. Mizuho also mentioned an opportunity for interested parties to join a breakfast with a major Oracle partner on September 12th during the CloudWorld event. In other recent news, Oracle Corporation reported a 7% year-over-year increase in revenues, totaling $13.31 billion, with a notable 46% year-over-year acceleration in its Cloud Infrastructure segment. Oracle has also been expanding its partnerships with Google (NASDAQ:GOOGL) Cloud and Amazon Web Services, launching joint database services to simplify cloud migration and enterprise workload management. On the legal front, Oracle settled a privacy lawsuit for $115 million. In the realm of acquisitions, Oracle co-founder Larry Ellison is set to gain control of Paramount Global following Skydance Media's acquisition of the Redstone family's stake in the film and television company. Oracle Corporation (NYSE:ORCL) has shown a strong performance, as reflected in its recent first-quarter results, which have been further acknowledged by Mizuho's raised price target. To provide a more comprehensive financial perspective, InvestingPro insights reveal that Oracle has been consistent in rewarding shareholders, having raised its dividend for 10 consecutive years. This consistency is a testament to the company's financial health and commitment to returning value to its investors. From a valuation standpoint, Oracle is currently trading at a high earnings multiple, with a P/E Ratio of 36.89. This indicates a premium valuation relative to the market, which could be justified by Oracle's position as a prominent player in the software industry and its potential for growth, particularly in cloud infrastructure as highlighted by the partnership with AWS. However, it is also important to note that Oracle's short-term obligations exceed its liquid assets, which could be a point of consideration for risk-averse investors. Moreover, the company has experienced a large price uptick over the last six months, with a 25.19% return, suggesting strong investor confidence. For readers seeking deeper analysis and more such insights, there are over 14 additional InvestingPro Tips available, which can be explored for a more informed investment decision. These tips are part of the comprehensive analysis provided by InvestingPro, which includes metrics such as revenue growth, dividend yield, and fair value estimates. For instance, Oracle's revenue growth over the last twelve months was 6.02%, indicating a steady increase in its financial performance. Interested investors can find further details and tips at https://www.investing.com/pro/ORCL.

KeyBanc increases Oracle stock target on cloud momentum By Investing.com

On Tuesday, KeyBanc Capital Markets maintained its Overweight rating on shares of Oracle Corporation (NYSE:ORCL) and increased the price target to $175 from $165. The adjustment follows Oracle's recent performance, where a significant build in Remaining Performance Obligations (RPO) overshadowed less impressive headline figures. The firm highlighted that the total RPO grew by 52.5% year-over-year, surpassing the consensus estimate by nearly 10%. The growth in RPO is particularly noteworthy as it comes against the backdrop of what was considered the easiest comparison from the fiscal year 2024. Although there was a notable deceleration on a two-year stack basis, the robust RPO growth is viewed as sufficient to alleviate concerns arising from the Oracle Cloud Infrastructure (OCI) recognized revenue, which did not demonstrate significant upside this quarter. KeyBanc expressed some curiosity regarding Oracle's capital expenditures, noting that their unexpectedly low level drew attention. Despite this, the firm's overall stance on Oracle remains positive. The sustained momentum observed in the cloud sector's numbers is expected to be a driving force behind the stock's future performance. The report emphasizes that while Oracle's headline results may not have been characterized as weak this quarter, the focus has shifted to other indicators of cloud momentum, such as RPO growth. This metric is seen as an important sign of Oracle's continued progress in the cloud market, which KeyBanc believes will eventually be reflected in other financial figures. As a result, the firm has confidently raised its price target for Oracle's shares. In other recent news, Oracle Corporation has unveiled several advancements in its services and reported robust financial growth. The company has launched the Oracle Cloud Infrastructure (OCI) Generative AI (GenAI) Agents service, which includes retrieval-augmented generation (RAG) capabilities. This service aims to streamline the application of AI in business processes. Oracle also announced the introduction of a new AI-centric application development infrastructure, termed generative development (GenDev), and new AI capabilities within its Oracle Fusion Data Intelligence suite. Oracle reported an 8% increase in total revenue to $13.3 billion, with a significant rise in cloud revenue of 22% to $5.6 billion, and Infrastructure as a Service (IaaS) revenue surging by 46%. Analyst firms CFRA, TD Cowen, and BMO Capital have responded to these developments by maintaining or adjusting their price targets for Oracle. The company also announced the beta release of Oracle Code Assist, an AI tool aimed at boosting developer productivity, and plans to enhance its Oracle Data Intelligence Platform with the addition of Oracle Intelligent Data Lake by 2025. Oracle has integrated Oracle Cloud Infrastructure Zero Trust Packet Routing into its cloud network for enhanced security. These are recent developments at Oracle Corporation. KeyBanc Capital Markets' recent price target increase for Oracle Corporation reflects optimism about the company's future, particularly in the cloud sector. In support of this perspective, InvestingPro offers valuable insights that can further inform investors about Oracle's financial health and market position. According to InvestingPro Data, Oracle has a market capitalization of $426.36 billion, demonstrating its substantial presence in the industry. Its P/E ratio stands at 36.05, which indicates that investors are willing to pay a premium for Oracle's earnings. This is further supported by a solid revenue growth of 6.02% over the last twelve months as of Q1 2023, showcasing the company's ability to increase its sales figures. InvestingPro Tips highlight that Oracle has raised its dividend for 10 consecutive years, signaling confidence in its financial stability and commitment to returning value to shareholders. Additionally, the company is a prominent player in the Software industry, which aligns with KeyBanc's positive outlook on Oracle's cloud sector momentum. For investors seeking more detailed analysis and additional insights, InvestingPro provides further tips on Oracle's financial metrics and industry performance. There are 14 more InvestingPro Tips available that delve into aspects such as Oracle's profitability, valuation multiples, and analysts' predictions for the company's profitability this year. These insights from InvestingPro reinforce the view that Oracle is a strong contender in its field, with a robust financial foundation and promising growth prospects in the cloud market.

Cloud momentum drives Oracle stock upgrade to outperform - JMP Securities By Investing.com

On Tuesday, Oracle Corporation (NYSE:ORCL) received an upgrade in its stock rating to Market Outperform from Market Perform by JMP Securities. This positive shift in rating is accompanied by a new price target of $175.00, indicating a strong confidence in the company's performance. The upgrade follows Oracle's impressive first-quarter results for the fiscal year 2025, which surpassed the consensus estimates. Oracle reported non-GAAP earnings per share (EPS) of $1.39, exceeding the expected $1.32. Additionally, the company achieved an operating margin of 42.9%, higher than the anticipated 42.2%. These results were driven by a revenue of $13.31 billion, a 7% year-over-year increase, and above the consensus forecast of $13.20 billion. Oracle's cloud segments exhibited significant growth, with Infrastructure as a Service (IaaS) revenue growing by 45% year-over-year, an acceleration from 42% growth in the previous quarter. Meanwhile, Software as a Service (SaaS) maintained a steady growth rate of 10%, consistent with the last quarter's performance. Perhaps most notable was Oracle's reported remaining performance obligations (RPO), which reached $98 billion, a substantial 53% increase year-over-year. This figure notably surpassed JMP Securities' estimate of $86 billion and represents an increase from the 44% growth seen in the previous quarter. Following the announcement of these robust financial metrics, Oracle's stock experienced an approximate 9% surge in after-market trading. This jump adds to the stock's already impressive year-to-date (YTD) gain of 33%, which outperforms the S&P 500's 15% increase and the Russell 3000's 13% rise over the same period. Oracle's strong quarterly results and the consequent upgrade by JMP Securities reflect the company's solid growth trajectory in the competitive tech market. In other recent news, Oracle Corporation has entered into major collaborations with Google (NASDAQ:GOOGL) Cloud and Amazon (NASDAQ:AMZN) Web Services (AWS) to launch joint database services, marking significant strides in multicloud strategies. Oracle's database services are now directly accessible in Google Cloud datacenters, and the Oracle Database@AWS service is set to streamline cloud migration and management of enterprise workloads. These developments aim to leverage Oracle's database technologies with Google Cloud's analytics and AI tools and AWS's scalable platform. Oracle is also set to release its first-quarter earnings report, with TD Cowen projecting a quarter in line with expectations and approximately 7% constant currency growth. The company has also received reaffirmed Buy ratings from TD Cowen, Deutsche Bank (ETR:DBKGn), Edward Jones, and Mizuho, with Bernstein reiterating an Outperform rating, emphasizing Oracle's strategic shift towards cloud services. In recent legal news, Oracle has settled a privacy lawsuit for $115 million. Additionally, TikTok is contesting the U.S. Department of Justice's mandate for its parent company, ByteDance, to divest its U.S. operations, asserting that its user data is securely stored on U.S.-based Oracle cloud servers. In acquisition news, Oracle co-founder Larry Ellison is set to gain control of Paramount Global following Skydance Media's acquisition of the Redstone family's stake in the film and television company. These are recent developments in the ongoing operations of Oracle Corporation. Oracle Corporation's (NYSE:ORCL) recent upgrade by JMP Securities is bolstered by its strong financial performance and strategic positioning in the cloud market. InvestingPro data highlights Oracle's robust fundamentals, with a market cap of $385.52 billion and a P/E ratio of 36.89, which, while high, underscores the market's high expectations for the company's future earnings. The company's revenue growth for the last twelve months as of Q4 2024 stood at 6.02%, reflecting a steady upward trajectory in its financial performance. Beyond the numbers, InvestingPro Tips identify Oracle as a prominent player in the Software industry, with a record of raising its dividend for 10 consecutive years and maintaining dividend payments for 16 consecutive years. This consistency in rewarding shareholders is a testament to Oracle's financial health and its commitment to returning value to investors. Additionally, analysts predict the company will be profitable this year, a forecast that aligns with Oracle's positive earnings per share (EPS) and operating margin reported in the first quarter of fiscal year 2025. Investors interested in Oracle's growth story and future prospects can find a wealth of additional insights on InvestingPro, which lists 15 more InvestingPro Tips for a comprehensive analysis. These tips provide a deeper dive into the company's valuation multiples, liquidity position, and historical stock performance, offering a well-rounded view of Oracle's investment potential.

Oracle stock boosted by robust cloud backlog and AI partnerships, says Evercore By Investing.com

On Tuesday, Oracle Corporation (NYSE:ORCL) saw an increase in its price target from $160.00 to $175.00 by Evercore ISI, while the firm maintained an Outperform rating on the stock. The adjustment followed Oracle's solid first-quarter results, which were notably marked by a significant 46% year-over-year growth in Infrastructure as a Service (IaaS) in constant currency terms. The company's management has indicated that they anticipate growth to accelerate throughout fiscal year 2026. Although Oracle's earnings per share (EPS) benefited from a lower tax rate and some one-time advantages due to changes in the useful life of certain assets, Evercore ISI emphasized that the real highlight is the robust growth in cloud backlog, as indicated by a 52% year-over-year increase in Remaining Performance Obligations (RPO) in constant currency. At the CloudWorld event this week, expectations are set for Oracle to present its comprehensive cloud and artificial intelligence (AI) strategy, which supports a sustainable double-digit growth outlook. Details regarding Oracle's partnerships with hyper-scalers and advancements in Generation AI are also anticipated. The positive outlook is further supported by the belief that Oracle's ongoing collaborations with Azure, Google (NASDAQ:GOOGL) Cloud Platform (GCP), and now Amazon (NASDAQ:AMZN) Web Services (AWS) will enhance the ease with which customers can transition their databases to the cloud. This ease of transition is seen as a potential boon to Oracle's cloud database business. Evercore ISI has revised its estimates upward in response to the company's performance and guidance, which points to a revenue target of $65 billion and operating margins of 45% by fiscal year 2026. This guidance, along with the potential for Street estimates to align more closely with the company's projections, is expected to contribute to further multiple expansion from current levels. Consequently, the price target of $175 is based on the stock trading at 26 times the estimated CY25 EPS, reinforcing the Outperform rating. Oracle Corporation's (NYSE:ORCL) recent performance and future prospects have caught the attention of investors and analysts alike, with Evercore ISI raising its price target following strong quarterly results. Delving into the financial metrics, Oracle boasts a robust market cap of $385.52 billion, reflecting the company's substantial presence in the market. Despite trading at a high earnings multiple with a P/E ratio of 36.89, Oracle has demonstrated a commitment to shareholder returns, having raised its dividend for 10 consecutive years -- an indicator of financial stability and confidence in sustained profitability. InvestingPro Tips highlight Oracle's prominence in the software industry and its ability to maintain dividend payments for 16 consecutive years. This consistency in dividend payments underscores Oracle's financial discipline and operational efficiency. The company's revenue growth over the last twelve months stands at 6.02%, showcasing its ability to expand its top-line in a competitive sector. For investors seeking further insights and tips on Oracle, InvestingPro offers additional in-depth analysis and metrics, with 15 more InvestingPro Tips available that could help in making informed investment decisions. As Oracle continues to evolve its cloud and AI offerings, its strategic partnerships with major cloud providers could further enhance its market position. The company's solid financial foundation, combined with its strategic growth initiatives, positions it favorably for the future, as reflected in the upward revision of its price target by Evercore ISI.

Oracle stock boosted by unexpected RPO acceleration in Q1, says Barclays By Investing.com

On Tuesday, Barclays (LON:BARC) has increased its price target for Oracle Corporation (NYSE:ORCL) to $172.00, up from the previous $160.00, while maintaining an Overweight rating on the stock. The decision comes after Oracle reported its first-quarter results, which, although typically a smaller quarter in terms of expectations, showed a slight outperformance. Oracle's first quarter saw a modest acceleration in the growth of its Software as a Service (SaaS) and Infrastructure as a Service (IaaS) offerings, which was a positive note for the company's shares. However, the most significant impact on the analyst's outlook was the reported growth in Remaining Performance Obligations (RPO). The RPO, a measure of future revenue, not only increased sequentially, which is unusual for the first quarter, but also showed a marked acceleration, growing 53% year-over-year compared to the 44% growth rate in the fourth quarter. Barclays highlighted that the strong RPO figure is a key factor in changing the narrative around Oracle. Previously, on July 19, 2024, it was noted that Oracle was under-owned by many large long-only accounts. The current results are expected to contribute to a shift in perception and support a continued upward trajectory for Oracle's stock. The analyst from Barclays concluded that the results like the ones Oracle has posted for the first quarter are likely to go a long way in continuing to change the narrative around the company. With the maintained Overweight rating, the firm signals its positive stance on Oracle's stock performance going forward. In other recent news, Oracle Corporation has seen a wave of analyst upgrades following strong first-quarter results. Jefferies raised its price target for Oracle to $170, citing positive quarterly-to-date results, particularly in the Retail and e-Commerce segments. Similarly, Evercore ISI increased Oracle's price target to $175, highlighting robust growth in cloud backlog. DA Davidson lifted its price target for Oracle to $140, attributing this to a surge in demand for AI training compute capacity on Oracle's Cloud Infrastructure. Deutsche Bank (ETR:DBKGn) pushed Oracle's price target to $180, emphasizing the company's impressive Cloud Infrastructure segment growth. Finally, Goldman Sachs (NYSE:GS) revised its price target for Oracle to $155, acknowledging the momentum in Oracle's Cloud Infrastructure. Oracle's first quarter results revealed a 7% year-over-year increase in revenues, reaching $13.31 billion. The Cloud Infrastructure segment saw a revenue growth acceleration to 46% year-over-year, contributing to a 52% year-over-year growth in Remaining Performance Obligations. Oracle's partnerships with Google (NASDAQ:GOOGL) Cloud and Amazon (NASDAQ:AMZN) Web Services have led to the launch of joint database services, aimed at streamlining cloud migration and management of enterprise workloads. On the legal front, Oracle recently settled a privacy lawsuit for $115 million. In acquisition news, Oracle co-founder Larry Ellison is set to gain control of Paramount Global following Skydance Media's acquisition of the Redstone family's stake in the film and television company. These are recent developments that continue to shape Oracle's trajectory. Oracle Corporation's (NYSE:ORCL) recent performance has drawn attention, with Barclays raising its price target. To further inform our understanding of Oracle's financial health and stock potential, InvestingPro metrics provide a snapshot of its valuation and profitability. Oracle's market capitalization stands at a robust $385.52 billion, reflecting its substantial presence in the market. Despite a high P/E ratio of 36.89, indicating a premium valuation, the company's revenue growth over the last twelve months has been positive at 6.02%. This growth is a testament to Oracle's ability to expand its business in a competitive industry. InvestingPro Tips suggest that Oracle has been a consistent performer, maintaining dividend payments for 16 consecutive years and raising its dividend for 10 consecutive years. This demonstrates Oracle's commitment to returning value to shareholders. Furthermore, analysts predict the company will be profitable this year, which is supported by a strong gross profit margin of 71.41% in the last twelve months. These factors may contribute to the narrative shift that Barclays anticipates. For investors seeking more insights, there are additional InvestingPro Tips available on Oracle, including analysis on its trading multiples and liquidity position. Visit https://www.investing.com/pro/ORCL for a comprehensive list of tips and to explore the full range of data points and analysis offered by InvestingPro.

Deutsche lifts Oracle shares price target, maintains Buy rating By Investing.com

The revision followed Oracle's impressive first quarter results, which surpassed expectations on all major metrics. The analyst highlighted the company's Cloud Infrastructure (OCI) segment, which exhibited a notable acceleration in revenue growth, reaching 46% year-over-year on a constant currency basis, up from 42% in the previous quarter. The growth is anticipated to continue throughout the year as Oracle rapidly expands its capacity. In a quarter that typically doesn't yield significant movements, Oracle's Remaining Performance Obligations (RPO) actually saw a sequential increase, contributing to a 52% year-over-year growth. Additionally, the company disclosed that Cloud RPO, representing three-quarters of the total, surged by more than 80% year-over-year. This robust performance is supported by strong demand for both AI and non-AI solutions. The report from Deutsche Bank also pointed out Oracle's unique position in the cloud market, with its ability to cater to niche segments. Oracle's differentiated offerings allow it to serve markets that are challenging for competitors to access, such as private clouds, smaller dedicated regions, and large-scale, secure sovereign clouds. In other recent news, Oracle Corporation's recent financial results have surpassed consensus estimates, with a reported revenue of $13.31 billion, marking a 7% year-over-year increase. Goldman Sachs (NYSE:GS) has raised its price target for Oracle to $155, while maintaining a neutral stance. JMP Securities has upgraded Oracle's stock rating to Market Outperform, reflecting confidence in the company's performance. Oracle has also announced significant partnerships with Google (NASDAQ:GOOGL) Cloud and Amazon (NASDAQ:AMZN) Web Services (AWS), launching joint database services to streamline cloud migration and enterprise workload management. In legal developments, Oracle has settled a privacy lawsuit for $115 million. Oracle co-founder Larry Ellison is set to gain control of Paramount Global following Skydance Media's acquisition of the Redstone family's stake in the film and television company. Oracle Corporation's recent performance has caught the attention of investors and analysts alike, leading to a positive outlook from Deutsche Bank. In light of this, InvestingPro provides additional insights that could be pertinent for investors considering Oracle's stock. Notably, Oracle has a track record of raising its dividend for 10 consecutive years, demonstrating a commitment to shareholder returns. Moreover, the company has been able to maintain dividend payments for 16 consecutive years, which speaks to its financial stability and reliability. From a valuation standpoint, Oracle is trading at a high earnings multiple with a P/E ratio of 36.89, which is above the adjusted P/E ratio for the last twelve months as of Q4 2024 at 34.72. This suggests that the market has high expectations for the company's future earnings. Additionally, Oracle's revenue growth over the last twelve months stands at 6.02%, reflecting a steady increase in its top-line figures. The company's gross profit margin is also robust at 71.41%, indicating strong profitability relative to revenue. Investors should be aware that Oracle is trading at a high Price / Book multiple of 44.29, which could signal that the stock is priced at a premium compared to the company's book value. However, with the stock trading near its 52-week high and analysts predicting the company will be profitable this year, the market sentiment appears to be optimistic. For those seeking more detailed analysis, InvestingPro offers additional tips and metrics on Oracle, which can be found at https://www.investing.com/pro/ORCL.

Oracle' stock rises after 'solid' Q1 keeps analysts largely bullish

Oracle's (NYSE:ORCL) stock rose about 8% premarket on Tuesday after fiscal first quarter results beat estimates, which largely drew positive reactions from analysts. JMP upgrade Oracle to Market Outperform with a $175 price target. The company posted better-than-expected fiscal first quarter 2025 results, with non-GAAP EPS of $1.39 (consensus $1.32) and an operating margin of 42.9% consensus 42.2%) on revenue of $13.31B (consensus $13.20B), up 7% year-over-year versus 3% last quarter, said a team of analysts led by Patrick Walravens. The analysts upgraded the stock citing several reasons -- firstly, noting that after 13 years of single-digit organic total revenue growth, Oracle is reaccelerating into the double digits with CEO Safra Catz commenting on the call that "we remain very confident and committed to full-year total revenue growth growing double digits." The analysts added that revenue growth is accelerating because Oracle has successfully evolved into a leading strategic cloud platform services provider, having moved up to the leader's quadrant in Gartner's Magic Quadrant over the past two years. In addition, due to Co-Founder and Chief Technology Officer Larry Ellison's prescient investments in large Nvidia GPU clusters, over 160 cloud regions including sovereign and national security regions, and a distributed and multi-cloud architecture, Oracle is poised to gain share in the cloud infrastructure services market and seems well-positioned to capture share of Gen AI-related spending for the infrastructure and cloud services market, according to the analysts. Walravens and his team added that Oracle's new strategic partnership with Amazon may help offset some of the pressure seen on the database business from hosted PostgreSQL solutions. The analysts said their research indicates that Oracle is poised to win additional and new workloads from several vendors, including a leading AI research organization, a major AI/ML platform provider, a major media company, and companies linked with the world's richest person. Morgan Stanley kept its Equal-weight rating on the stock but raised the price target to $145 from $125. Analysts led by Keith Weiss said that bookings growth picked back up in the first quarter, along with Strategic Apps and Oracle Cloud Infrastructure, or OCI, revenues, indicating that key Oracle trend lines are showing positivity after the fourth quarter downturn. However, absent an accounting change, gross margins see further pressure and billings growth still lags, adding risk to the EPS outlook. Evercore reiterated its Outperform rating on Oracle and raised the price target on the shares to $175 from $160. Oracle delivered solid first quarter results that were highlighted by strong IaaS (infrastructure as a service) growth (+46%) and a continued call from management that growth will accelerate over the course of fiscal year 2026, said analysts led by Kirk Materne. The analysts believe that the bigger story is the strength in cloud backlog growth (Remaining Performance Obligations, or RPO, up 52% year-over) and the potential benefits to the cloud database business as the relationships with Azure, GCP, and now AWS, make it easier for customers to move their databases to the cloud. BofA raised its price target on ORCL to $175 from $155 citing accelerating topline and EPS growth. However, the firm reiterated its Neutral rating on the Oracle, pending sustained current remaining performance obligation, or cRPO, growth acceleration and proof of leverage on ramping capital expenditure, or Capex. The analysts said that Oracle reported another quarter of accelerating RPO growth as the company continues to transition to the cloud. However, cRPO moved the other way, decelerating to 18% from 33%. The outlook was somewhat mixed, with expected fiscal second quarter revenue growth of 8% below BofA's 9% estimate, the analysts stated. In addition, an aggressive second half ramp is required to achieve the fiscal 2025 outlook for double-digit growth, according to the analysts. Meanwhile, Mizuho raised it price target on the stock to $185 from $170 and maintained its Outperform.