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UBS raised its price target on Oracle (NYSE:ORCL) to $225.00 from $200.00 on Thursday, while maintaining a Buy rating on the stock amid strong growth indicators. The stock, currently trading near its 52-week high of $198.31, has delivered a robust 27.05% return over the past year, though InvestingPro analysis suggests the shares are trading above their Fair Value.
The firm cited Oracle’s significant backlog growth as a key factor in its decision, noting the company is projecting 100% backlog growth to over $275 billion in fiscal year 2026, which UBS described as "extraordinary" and implying "more backlog dollar growth than Microsoft (NASDAQ:MSFT) is likely to post."
Oracle demonstrated resilience against challenging macroeconomic conditions that have affected other software companies, posting an acceleration in growth to 11% from 8% in the previous quarter, along with strong license growth of 8%.
The company also raised its fiscal year 2026 growth guidance to 16% from 15%, though UBS acknowledged potential concerns about margin erosion in FY26.
UBS concluded that the positive demand signals and backlog growth outweigh margin concerns, predicting that any after-hours rally in the stock "will get bought (not sold)."
In other recent news, Oracle reported $15.9 billion in total revenue for its fiscal fourth quarter of 2025, marking an 11% year-over-year increase in constant currency. The Oracle Cloud Infrastructure (OCI) notably grew 62% during the quarter, with projections for OCI growth to exceed 70% in fiscal year 2026. Analysts from DA Davidson, Cantor Fitzgerald, and Stifel raised their price targets for Oracle, citing strong guidance and growth in cloud services. Cantor Fitzgerald highlighted Oracle’s Infrastructure as a Service (IaaS) revenue, which is expected to grow more than 70% in fiscal 2026, surpassing consensus expectations. Oracle’s Remaining Performance Obligation (RPO) grew 41% at the end of fiscal 2025 and is projected to grow over 100% in fiscal 2026, excluding the Stargate initiative. The company also raised its fiscal year 2026 revenue guidance to over $67 billion, representing approximately 16% year-over-year growth. Morgan Stanley (NYSE:MS) reiterated its Equalweight rating and noted Oracle’s ambitious fiscal 2026 guidance, while Oppenheimer maintained its Perform rating, citing valuation concerns despite strong growth outlooks. Oracle plans to open 47 additional Multicloud Datacenters over the next 12 months, expanding its current 23 locations.
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