RBC Capital Starts Oracle (ORCL) at Sector Perform

RBC Capital analyst Rishi Jaluria initiates coverage on Oracle (NYSE: ORCL) with a Sector Perform rating and a price target of $165.00.

The analyst comments: "While multicloud strategies and partnerships have helped OCI gain traction in the market, we believe it will be difficult for OCI to catch up to Azure and AWS. In our view, given customer frustration with some of Oracle’s business practices, the distinction between true cloud and hosted solutions, and the uncertainty of OCI in a GenAI world, we believe it seems unlikely that Oracle will meaningfully challenge AWS, Azure, or GCP, at least in the near term. Given the need for substantial growth acceleration to meet Oracle’s FY26 and FY29 revenue targets, achieving these targets seems challenging. While there may be opportunities for margin expansion as OCI scales, the high and sustained levels of CapEx could limit overall expansion. With that in mind, we believe Oracle’s ability to meet its financial targets remains at risk. Oracle’s AI positioning is currently being overestimated in terms of potential monetization. While the company has integrated AI into OCI and Fusion offerings, we believe these advancements are unlikely to significantly shift the company’s competitive positioning. Additionally, there remains skepticism about OCI’s long-term attractiveness as training costs decline and the industry gravitates towards AWS and Azure (who own mind share) for inference workloads. Lastly, Oracle’s lack of a common underlying data model may prove difficult when trying to fully harness the power of GenAI."

For an analyst ratings summary and ratings history on Oracle click here. For more ratings news on Oracle click here.

Shares of Oracle closed at $175.31 yesterday.

You May Also Be Interested In

• Oracle (ORCL) PT Raised to $300 at TD Cowen on 'Favorable Setup'
• Revolution (RVMD) trading up 1%, RBC says that's about what they expected it to trade
• Zevra Therapeutics, Inc. (ZVRA) PT Raised to Street High $34 at Cantor Fitzgerald