Wedbush Initiates Coverage on Oracle with Outperform Rating
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1 hour ago
0mins
Should l Buy ORCL?
Source: seekingalpha
- Rating Upgrade: Wedbush initiates coverage on Oracle (ORCL) with an Outperform rating and a $225 price target, which is expected to prompt a reassessment of the company's long-term growth potential in the market.
- AI Strategic Advantage: Analysts highlight Oracle's partnerships with AI leaders like OpenAI and NVIDIA, along with the advancement of the Stargate project, positioning it as a foundational infrastructure provider in the AI revolution, showcasing strong market competitiveness.
- Cloud Infrastructure Innovation: Oracle Cloud Infrastructure (OCI) features a unique, flatter network architecture that delivers high-performance, low-latency computing essential for large-scale AI model training, significantly outperforming traditional complex cloud platforms.
- Strong Performance Metrics: Oracle's Remaining Performance Obligations (RPO) have surged to $553 billion, with a capital expenditure to RPO ratio of approximately 9.0%, well below the industry average of 45.6%, demonstrating the robustness of its investments and the strong contracted demand underpinning them.
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Analyst Views on ORCL
Wall Street analysts forecast ORCL stock price to rise
34 Analyst Rating
25 Buy
9 Hold
0 Sell
Moderate Buy
Current: 187.500
Low
180.00
Averages
309.59
High
400.00
Current: 187.500
Low
180.00
Averages
309.59
High
400.00
About ORCL
Oracle Corporation offers integrated suites of applications plus secure, autonomous infrastructure in the Oracle Cloud. The Company operates through three businesses: cloud and license, hardware and service. Its cloud and license business is engaged in the sale, marketing and delivery of its enterprise applications and infrastructure technologies through cloud and on-premise deployment models including its cloud services and license support offerings, and its cloud license and on-premise license offerings. Its hardware business provides infrastructure technologies including Oracle Engineered Systems, servers, storage, industry-specific hardware, operating systems, virtualization, management and other hardware-related software to support diverse IT environments. Its services business provides services to customers and partners to help maximize the performance of their investments in Oracle applications and infrastructure technologies.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- AI Strategic Advantage: Analysts highlight Oracle's partnerships with AI leaders like OpenAI and NVIDIA, along with the advancement of the Stargate project, positioning it as a foundational infrastructure provider in the AI revolution, showcasing strong market competitiveness.
- Cloud Infrastructure Innovation: Oracle Cloud Infrastructure (OCI) features a unique, flatter network architecture that delivers high-performance, low-latency computing essential for large-scale AI model training, significantly outperforming traditional complex cloud platforms.
- Strong Performance Metrics: Oracle's Remaining Performance Obligations (RPO) have surged to $553 billion, with a capital expenditure to RPO ratio of approximately 9.0%, well below the industry average of 45.6%, demonstrating the robustness of its investments and the strong contracted demand underpinning them.
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- AI Strategic Advantage: Analysts highlight Oracle's partnerships with AI leaders like OpenAI and NVIDIA, along with the advancement of the Stargate project, positioning it as a foundational infrastructure provider in the AI revolution, showcasing strong market competitiveness.
- Cloud Infrastructure Innovation: Oracle Cloud Infrastructure (OCI) features a unique, flatter network architecture that delivers high-performance, low-latency computing essential for large-scale AI model training, significantly outperforming traditional complex cloud platforms.
- Strong Performance Metrics: Oracle's Remaining Performance Obligations (RPO) have surged to $553 billion, with a capital expenditure to RPO ratio of approximately 9.0%, well below the industry average of 45.6%, demonstrating the robustness of its investments and the strong contracted demand underpinning them.
See More
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- Energy Security Threat: IEA head Fatih Birol warned that the current conflict has resulted in a loss of 13 million barrels of oil per day, marking the biggest energy security threat in history, which could trigger global market volatility.
- Market Reaction: U.S. stocks pulled back as investors grew wary of the ceasefire's prospects, while Asian markets opened mixed, reflecting a cautious sentiment regarding future developments.
- Corporate Layoffs: Meta plans to lay off 10% of its workforce, approximately 8,000 employees, while Nike will cut 1,400 jobs, indicating structural adjustments in the tech sector amid accelerated AI investments.
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- Oracle Stock Volatility: Oracle's shares fell 6% today but rebounded in after-hours trading, gaining 20% in April and 34% year-to-date, yet remain nearly 50% below last September's peak, reflecting uncertainty in its performance outlook.
- Private Equity Struggles: Carlyle Group dropped 4.4% on Thursday, down 30% since last September, while Apollo Global and KKR fell 3.3% and 4%, respectively, highlighting a broader weakness in the private equity sector that investors should monitor closely.
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- Mixed Economic Data: Weekly initial unemployment claims rose by 6,000 to 214,000, indicating a weaker labor market than the expected 210,000, while the Chicago Fed national activity index fell to -0.20, signaling a slowdown in economic growth.
- Rising Oil Prices: WTI crude oil prices surged over 3% due to tensions in the Strait of Hormuz, potentially exacerbating the global energy crisis and influencing market sentiment and inflation expectations.
- Earnings Reports Highlight: Despite the overall market weakness, 81% of S&P 500 companies reported better-than-expected earnings, with Q1 earnings projected to rise by 12% year-over-year, showcasing resilience in certain sectors, particularly chipmakers like Texas Instruments, which rose over 19%.
See More
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- Employee Eligibility Criteria: The program targets employees below the director level, requiring them to meet specific tenure and age criteria, thereby alleviating potential layoff pressures while offering employees a more favorable choice regarding their employment status.
- Industry-Wide Trend: This initiative aligns with the layoff trends seen in other tech giants like Meta, indicating that large tech companies are reshaping their workforce structures to adapt to rapidly changing market conditions and the demands of the AI era, highlighting widespread concerns within the industry.
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