HSBC raises price target for Oracle shares and maintains buy rating By Investing.com

HSBC updated its rating on Oracle Corporation (NYSE: NYSE:) and raised the stock’s price target from $180.00 to $210.00. The Buy rating was maintained.

The bank’s analyst bases this on Oracle’s expected sales development. Sales of over $66 billion are forecast for fiscal year 2026, rising to $104 billion by fiscal year 2029. For comparison: In fiscal year 2024, sales were $52.9 billion.

Oracle’s strategic entry into the cloud infrastructure market, albeit later than some competitors, was marked by the development of a second-generation cloud. This advancement enabled the company to offer a powerful, scalable and efficient cloud solution. In a note dated March 12, 2024, HSBC highlighted Oracle’s progress in this area.

The company is reportedly gaining market share through a competitive and technologically superior product. This is especially relevant as customers increasingly deploy AI infrastructures that require the capabilities offered by Oracle. According to HSBC’s analysis, demand for Oracle’s cloud infrastructure services is expected to grow significantly.

Other financial analysts have also commented on Oracle recently. TD Cowen raised its price target to $190, citing optimism about the company’s cloud growth and future revenue.

This followed Oracle’s CloudWorld conference, where the company unveiled ambitious revenue targets, including a forecast of $104 billion for fiscal 2029. Oracle also unveiled new AI capabilities that are expected to contribute to growth.

BMO Capital maintained its price target of $173, emphasizing confidence in Oracle’s growth potential. Piper Sandler raised the price target to $185, highlighting expected revenue growth in cloud and artificial intelligence.

However, Citi remained neutral, citing uncertainties in the rapidly evolving technology landscape. Evercore ISI raised its price target on Oracle to $190, focusing on the company’s robust growth outlook, particularly in its hyperscale cloud business.

InvestingPro Insights

As Oracle Corporation (NYSE:ORCL) continues to make progress in the cloud infrastructure market, real-time data and insights from InvestingPro provide a deeper understanding of the company’s financial position and stock performance. With an impressive market capitalization of $477.05 billion and a price-to-earnings ratio of 43.13, Oracle is a significant player in the software industry. The company’s revenue for the trailing twelve months to Q1 2023 reached $53.81 billion, representing growth of 5.6% and in line with HSBC’s positive forecasts.

InvestingPro Tips shows that Oracle has a respectable 15.83% yield over the last week, which underscores the company’s strong market position. In addition, Oracle has been consistent with its dividend payments and has continued doing so for 16 years in a row, which could be attractive to income-oriented investors.

For potential investors, it is worth noting that Oracle is trading near its 52-week high, with the share price at 98.9% of that peak. Despite some downward revisions to earnings estimates for the coming period, Oracle’s recent performance and strategic focus on cloud infrastructure growth present a compelling investment case. For further insights, over 20 additional InvestingPro tips are available at https://www.investing.com/pro/ORCL.

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