The Zhitong Finance App learned that recently, Citi added the IT giant to the 90-day positive catalyst watch list. The bank maintains a “buy” rating with a target price of $330. As of press release, Oracle (ORCL.US) rose 1.2% in overnight trading to $150.64.
“We are initiating positive catalyst observation and re-examining the bullish logic of Oracle's cloud business,” Citibank analyst Tyler Radke wrote in a research report to clients.
“We believe that after experiencing the most extreme valuation misalignment and retracement in the stock's history, an opportunity has surfaced — this round of decline stemmed from investors' panic selling and a number of technical selling factors (widening credit spreads, additional ATMs).
We judge that the continued strong trend in AI demand, as well as the profit/pricing transmission effect from 'new cloud vendors', will lay the foundation for improving profit forecasts, which in turn will push the stock price to strengthen before the results release in late October and Investor Day.”
Over the past three months, Oracle's stock price has dropped by about 25%, significantly outperforming its large technology peers (up an average of about 10% over the same period); the decline over the past 12 months is closer to 40%.
Despite stock price pressure, Oracle's business fundamentals remain strong. The cloud infrastructure business has exploded. In the fourth quarter of fiscal year 2026, Oracle Cloud Infrastructure (IaaS) revenue increased 93% year over year to US$5.8 billion. AI infrastructure revenue increased 243% year over year, and multi-cloud database revenue increased 531% year over year.
The backlog of orders reached a record high. Unfulfilled contractual obligations (RPO) soared to $638 billion, an increase of $85 billion over a single quarter. The company signed a $67 billion AI infrastructure contract during the quarter. The customer paid approximately $75 billion in advance for AI-related hardware, partly sharing Oracle's infrastructure construction burden.
The AI strategy runs through the entire stack. Oracle CEO Mike Sicilia said at the Deutsche Bank Technology Conference that the company is deeply integrating AI into the Fusion application suite and expects about half of the existing customers still deployed locally (especially in regulated industries) to move to the cloud.