By Gian Estrada
Publication Date: 2026-02-06 18:05:00
Key Takeaways:
- Backlog inflection: Oracle’s $523 billion RPO base and $68 billion quarterly expansion suggest that demand for AI infrastructure is translating into contract revenue, with OCI already growing 66% and cloud revenue reaching $8 billion in the quarter.
- Capital and legal surplus: Oracle’s $25 billion note deal and a class action lawsuit related to AI CapEx intensity frame investors’ focus on balance sheet and cash conversion after management raised FY26 CapEx expectations by $15 billion.
- Target price range: Oracle stock could reach $296 by 2028 given its FY26 base of $67 billion and a compounded revenue growth rate (CAGR) of 31%, operating margin of 39%, and a 19x exit P/E ratio that anchors post-build normalization.
- Return math: Oracle’s target of $296 implies an upside of 117% from the current price of $136, representing a 40% annual return over approximately two years based on earnings growth and a stable 19x multiple.
Model how Oracle’s cloud infrastructure growth and application context…
