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Investing.com - Guggenheim raised its price target on Oracle (NYSE:ORCL) to $375.00 from $250.00 on Wednesday, while maintaining a Buy rating on the database and cloud computing giant. The company, currently valued at $678 billion, has shown remarkable momentum with a 63% surge over the past six months, though InvestingPro analysis indicates the stock is trading above its Fair Value.
The significant price target increase follows Oracle’s F1Q26 results, which Guggenheim described as giving "a peek into a future that we haven’t seen in over 25 years covering the Software sector." The firm highlighted Oracle’s long history of technological innovation, from RAC 25 years ago to more recent developments like Multitenancy and Autonomous Database. As a prominent player in the software industry, Oracle maintains strong profitability with a 70.5% gross margin and 8.4% revenue growth in the last twelve months.
Guggenheim emphasized Oracle’s cloud infrastructure developments, particularly OCI Gen2, which integrates cloud technologies with Oracle’s proprietary technologies and enhanced security features. The firm believes Oracle’s technological advantages are sustainable despite potential competition from newer market entrants.
The research firm expressed confidence in Oracle’s ability to handle various workloads, from AI training and inferencing to traditional cloud applications and specialized deployments like Sovereign Clouds and Dedicated Regions. Guggenheim noted that Oracle’s capability to run demanding cloud workloads positions it well for less demanding applications too.
Oracle remains Guggenheim’s "Best Idea," with the firm citing higher cash flow estimates in future years as the basis for the substantial price target increase. Investors are anticipating further details at the upcoming Oracle AI World event on October 16. For deeper insights into Oracle’s valuation metrics and growth potential, InvestingPro subscribers can access comprehensive analysis and 15+ additional ProTips in our detailed research report, helping investors make informed decisions ahead of this crucial event.
In other recent news, Oracle has reported impressive growth in its remaining performance obligations (RPO), reaching $455 billion, largely due to significant artificial intelligence contracts secured during the first quarter. This development has led several analyst firms to adjust their price targets for the company. Barclays increased its price target to $347, citing Oracle’s substantial RPO growth. Mizuho also raised its target to $350, emphasizing the company’s 359% year-over-year growth in RPO, which positions Oracle as a key player in AI infrastructure. Wolfe Research set an even higher target of $400, highlighting the extraordinary demand for Oracle’s cloud infrastructure driven by AI. Meanwhile, DA Davidson raised its price target to $300, noting that Oracle’s fiscal first-quarter earnings were largely in line with expectations. Evercore ISI increased its target to $340, pointing to the accelerating backlog in Oracle Cloud Infrastructure as a significant factor. These developments underscore the analysts’ recognition of Oracle’s strategic positioning in the AI and cloud infrastructure markets.
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