Oracle’s (NYSE: ORCL) stock market has reached a boil.
A combination of factors, resulting from years of work positioning the company, including results, guidance, and trends in analysts' sentiment, is driving this market, and it is likely to head higher. Much higher. The technical outlook in late June was bullish.
After rebounding from its sharp early-year correction, the market rose to set a new all-time high and began forming a small consolidation.
The early take is that the market is waving a flag, a Bull Flag, signaling it has only started to rally. It can continue to rise by another $98 to trade well above $300 before the end of the year.
Oracle’s Business Gains Momentum Due to Its Cloud Strength
The forces that drive Oracle’s uptrend begin with its results. The FQ4 results reflected the momentum shown in earlier reports, growing backlogs but not in revenue, affirming a robust outlook and a central position in AI infrastructure. The critical takeaway from F2025 is that Oracle is now the leading provider of AI-enabled database and cloud services globally, entrenched in the fabric of all three major hyperscalers, and a rapidly growing hyperscaler in its own right. Oracle’s data cloud infrastructure (IaaS) revenue grew more than 50% annually in Q4 and is likely to continue growing at a hyper pace in FY2026.
The company’s guidance is robust, adding momentum to the uptrend. Oracle’s CEO, Safra Catz, says revenue growth rates will be “dramatically higher” in F2026, driven by strength in the cloud. Oracle's Total Cloud revenue is projected to accelerate to over 40% YOY growth, which will be led by an acceleration to over 70% in IaaS.
The truly invigorating news is that the RPO, or remaining performance obligation—a leading indicator of the business—is forecast to accelerate to over 100%, suggesting that business acceleration will continue into the following year. And the guidance may be cautious. AI-focused data center spending is gaining momentum globally and is likely to be reflected in the upcoming earnings report, due in early September.
Analysts Stoke the Flames, Raise the Heat for Oracle’s Market
The analysts' trends following Oracle’s release are robust, raising the stakes for its investors. The recent activity includes a report from Evercore ISI about its trip to Europe to meet with clients, as well as a price target increase from Guggenheim. The takeaway is that investor attention is shifting to Oracle globally as they ponder how high the market can rise.
Guggenheim believes the company is at the precipice of a narrative shift, expecting its revenue and earnings to accelerate significantly over the next two years. Guggenheim’s new $250 target is the current high on Wall Street, a 16% increase from the early June highs when reached.
Institutions and short-sellers are not an issue for this market and could even intensify future price swings. The short interest is very low, under 1% at the end of May, and has been falling sequentially, providing little to no market headwind while institutional activity remains supportive. They own only 40% of the stock but are buying on balance in 2025, providing a solid support base and tailwind for the market.
The only bad news is Oracle’s valuation. Trading at over 45x its current year’s earnings, it is a highly valued tech stock trading above the expected range for a blue-chip company of its calibre. However, the growth forecasts put the valuation into perspective, reducing the price-to-earnings multiple to under 15x the 2030 forecast and seven times the 2025 forecast, and both estimates are likely to be conservative.
News released since the FQ4 release includes signs of accelerating business among all major hyperscalers and leading AI infrastructure players, including NVIDIA (NASDAQ: NVDA) and Advanced Micro Devices (NASDAQ: AMD), which will drive Oracle’s long-term growth.
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