US stock futures steady with China trade talks, Q3 earnings in focus
Investing.com - Barclays raised its price target on Oracle (NYSE:ORCL) to $400 from $367 on Friday, while maintaining an Overweight rating on the stock. The new target comes as Oracle, currently valued at $892 billion, trades at premium multiples according to InvestingPro data, with a P/E ratio of 72.5x.
The price target increase follows Oracle’s recent financial analyst day and customer conference, where the company revealed significant momentum in its infrastructure-as-a-service (IaaS) business with $65 billion in total contract value signed in Q2 from just seven deals with four customers. This momentum is reflected in Oracle’s impressive 89.7% YTD return and 144% surge over the past six months.
Barclays noted that Oracle’s new fiscal year 2030 revenue target of $225 billion substantially exceeds updated consensus estimates of $199 billion, with gross margins and earnings per share also surprising to the upside.
The firm highlighted Oracle’s fiscal year 2030 EPS target of $21, which surpasses consensus expectations of approximately $18, despite ongoing questions about capital intensity and financing requirements in the AI-driven technology landscape.
Barclays maintains its bullish stance on Oracle, stating that the company is "in the right place to benefit from the evolving trend" as the technology sector transitions to "a new AI world."
In other recent news, Oracle has reported strong growth in its cloud and AI infrastructure, with executives projecting cloud infrastructure revenue to reach $166 billion by fiscal year 2030. The company also noted that its distributed cloud offering is experiencing a 77% year-over-year growth, with an average deal size of $67 million. Meanwhile, Mizuho Securities clarified Oracle’s artificial intelligence gross margins, citing expectations of 30% to 40% margins for Oracle Cloud Infrastructure AI, following comments from the company’s CEO. Additionally, Oracle has expanded its AI Agent Studio for Fusion Applications by launching a new AI Agent Marketplace, allowing customers to deploy partner-built AI agents directly within Oracle Fusion Cloud Applications.
The United States Department of the Air Force has adopted Oracle Fusion Cloud Applications to enhance its operations, utilizing AI-powered applications for finance, human resources, and supply chain management. Similarly, the Choctaw Nation of Oklahoma has implemented Oracle Fusion Cloud Applications to improve efficiency and services for its 250,000 members, leveraging AI to automate processes and reduce costs. These developments highlight Oracle’s ongoing efforts to integrate AI into its offerings and expand its market reach.
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