Oracle (NYSE:ORCL) delivered quite the WOW moment when it reported Remaining Performance Obligations of $455 billion during its Fiscal Year 2026 First Quarter results in early September. This figure represented year-over-year growth of 359%, an achievement that sent the market into a frenzy.
Elevate Your Investing Strategy:
- Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
CEO Safra Catz deemed the quarter “astonishing,” and investors were certainly quick to agree. ORCL’s stock price bounded upward by some 36% the day after the news broke, an astonishing leap by any measure.
ORCL has crept downward a bit after this initial elation wore off, giving back some 7.5% since the one-day bonanza. While some of this can likely be chalked up to profit-taking, there are also worries about the profitability of Oracle’s AI business. In particular, a recent report from The Information detailed that the company’s major compute deals had an average gross margin of 16%.
So, which direction are the winds blowing for the veteran technology company? Investor Adria Cimino is predicting that Oracle’s stock will be climbing upward once more after Oracle’s AI World event concludes in Las Vegas today.
“Oracle stock, which has slipped over the past few weeks, may soar after Oct. 16,” says the 5-star investor.
In particular, Cimino is looking toward the Oracle Financial Analyst meeting, which is scheduled for later today. She believes this session, during which the company is planning on offering updates on its long-term forecasts, should help to address some of the investor concerns.
“Considering Oracle’s extremely optimistic comments during the earnings report just a few weeks ago, set against the general backdrop of high demand for AI capacity and growth in AI spending, I wouldn’t expect a negative surprise,” adds Cimino.
Still, the investor is hedging her bets. Even if she is wrong, Cimino contends that Oracle is set up nicely for the long-term.
In fact, the investor sums up that the company’s AI infrastructure business should help “supercharge” investor portfolios far into the future. (To watch Adria Cimino’s track record, click here)
For the most part, Wall Street seems to agree with Cimino. With 26 Buys, 8 Holds, and a single Sell, ORCL enjoys a Moderate Buy consensus rating. Its 12-month average price target of $346.63 suggests an upside of ~14%. (See ORCL stock forecast)
To find good ideas for stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a tool that unites all of TipRanks’ equity insights.
Disclaimer: The opinions expressed in this article are solely those of the featured investor. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.