Why Oracle Stock Soared Higher Today

Actions of Oracle (ORCL 5.13%) moved higher today as the tech giant continued to win praise from Wall Street analysts, a week after the company posted a strong fiscal first-quarter earnings report, as the company’s cloud infrastructure continues to grow in the age of artificial intelligence (AI).

As of 1:14 p.m. ET, the stock was up 6.3% on the news.

Image source: Getty Images.

Oracle still seems overlooked

Following gains following last week’s earnings report, shares continued to move higher as Melius Research upgraded the stock from hold to buy.

Melius credited Oracle’s accelerated revenue growth and stable, solid margins and believes the company can continue to beat analysts’ estimates. The research firm raised its price target from $155 to $210, implying a 22% upside for the stock.

In addition, on weekends, Jefferies raised his price target on the stock from $170 to $190 and reiterated his buy rating on the stock.

Analyst Brent Thill said after attending a recent investor conference and speaking with Oracle partners that the company is “getting its mojo back.” He also noted that growth in both Oracle Cloud Infrastructure and the backlog is accelerating.

Can Oracle stock continue to climb?

With its strength in database management and a cloud infrastructure business known for security, Oracle seems like the kind of business that should thrive in the age of AI, and indeed, it’s opening data centers faster than it ever has.

In the first quarter ended Aug. 31, the infrastructure business grew 45 percent to $2.2 billion, and total revenue rose 7 percent to $13.3 billion.

Remaining performance bonds rose 53% in the quarter to $99 billion, showing that demand is growing, and adjusted earnings per share rose 8% to $1.39, meaning margins extend

The company remains optimistic about the future of AI and its cloud infrastructure business. Given this momentum, the stock looks like a good bet to keep gaining.