Oracle stock price target raised to $280 from $250 at UBS on AI growth

Investing.com - UBS raised its price target on Oracle (NYSE:ORCL) to $280 from $250 on Thursday, maintaining a Buy rating on the stock amid expectations of significant AI-driven growth. The stock, currently trading at $248.56, has surged 75% over the past year, though InvestingPro analysis suggests the stock is trading above its Fair Value.

The firm believes Oracle could be working with OpenAI on a major deal that would be "mostly (not entirely) incremental" to current business and might include both inference and training services for the AI company.

UBS noted the potential deal depends on the go-live of Oracle’s Abilene infrastructure and future Stargate GPU clusters, indicating some risk of capacity go-live delays that could affect timing.

By fiscal year 2029, UBS now estimates Oracle will reach revenues of $134 billion with operating margins of 38%, significantly higher than Oracle’s current guidance of $104 billion in revenue with 45% operating margins.

The firm also substantially increased its capital expenditure projections for Oracle, expecting capex to reach as high as $54 billion by FY29, up from its previous estimate of $35 billion, as the company invests heavily in AI infrastructure.

In other recent news, Oracle has seen a series of analyst upgrades and price target increases. Cantor Fitzgerald raised its price target for Oracle to $271, citing significant growth in Oracle Cloud Infrastructure (OCI) and Cloud Database Services (CDBS). Similarly, Evercore ISI increased its target to $270, highlighting Oracle’s strong fiscal year 2026 outlook and a substantial $30 billion annual contract. Piper Sandler also upgraded Oracle to Overweight, setting a new price target of $270, driven by strong AI momentum and potential growth beyond OpenAI and Stargate opportunities.

Bernstein followed suit by raising its price target to $269, noting Oracle’s growth acceleration and a multi-year contract expected to generate over $30 billion annually starting in fiscal year 2028. In other developments, Oracle has settled a long-standing legal dispute with Rimini Street (NASDAQ:RMNI). The settlement involves Oracle returning approximately $37.8 million to Rimini Street and includes a provision preventing new legal proceedings during a wind-down period. These recent developments reflect Oracle’s ongoing strategic growth and resolution of legal challenges.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.