KeyBanc maintains Oracle stock Overweight, $200 target

On Tuesday, KeyBanc Capital Markets reiterated its Overweight rating on Oracle Corporation (NYSE:ORCL) shares, maintaining a $200.00 price target. According to InvestingPro data, Oracle currently trades at a P/E ratio of 36.37 with a market capitalization of $416.16 billion, suggesting the stock is trading above its Fair Value. KeyBanc’s analyst Jackson Ader provided an optimistic view on the company’s performance, particularly highlighting the significant growth in Oracle’s remaining performance obligation (RPO). The RPO saw an unprecedented $33 billion increase, surpassing both quarterly and semi-annual records. This surge in bookings and the company’s robust pipeline have led Oracle’s management to raise growth expectations to 15% for fiscal year 2026 and 20% for fiscal year 2027, figures that exceed KeyBanc’s own forecasts of 13.2% and 14.1% growth, respectively.

Ader noted that Oracle’s RPO growth is a positive indicator, especially since it does not account for any potential contributions from the ambitious Project Stargate, which is valued at half-a-trillion dollars. InvestingPro analysis shows Oracle maintains a "GOOD" Financial Health Score of 2.52, with particularly strong marks in profitability (3.94/5). The analyst expressed a long-standing appreciation for Oracle’s performance, stating that despite the industry-wide issue of capacity constraints affecting all major cloud providers, Oracle’s size and business nature make it easier to observe the impact of artificial intelligence and cloud activities on its RPO and bookings.

Although Oracle Cloud Infrastructure (OCI) revenue fell short of expectations, Ader remains confident in the company’s growth prospects. He pointed out that the visible increase in OCI levels behind the capacity constraints suggests a strong buildup of demand, which supports KeyBanc’s positive stance on the stock.

The analyst’s comments come amid Oracle’s efforts to expand its cloud services and compete with larger hyperscalers in the market. With the company’s raised growth projections and substantial RPO buildup, KeyBanc’s reaffirmed Overweight rating and $200 price target reflect confidence in Oracle’s future performance. Oracle’s current revenue growth stands at 6.4%, according to InvestingPro, which offers a comprehensive Pro Research Report with detailed analysis of Oracle’s performance metrics, growth trajectory, and competitive position among 1,400+ top US stocks.

In other recent news, Oracle Corporation reported its Q2 2025 earnings, which showed a slight miss on both earnings per share (EPS) and revenue forecasts. The company posted an EPS of $1.47, slightly below the forecasted $1.49, and reported revenues of $14.1 billion, falling short of the anticipated $14.39 billion. Despite these misses, Oracle’s cloud revenue grew by 25% year-over-year, reaching $6.2 billion. The company also announced a significant AI infrastructure expansion through partnerships with NVIDIA (NASDAQ:NVDA) and AMD (NASDAQ:AMD). Oracle aims to achieve a $66 billion revenue target by FY26, projecting Q4 total revenue growth of 9-11% in constant currency. Analyst commentary highlighted Oracle’s robust bookings, with a backlog increase of $48 billion, and noted the company’s strategic focus on AI and cloud infrastructure. Additionally, Oracle’s operating income saw a 9% growth, achieving a 44% margin. Oracle’s recent performance trends and strategic expansions indicate a focus on maintaining growth in its cloud and AI sectors.

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