Oracle Corporation (ORCL) shares dropped over 6% during Thursday’s trading after Redburn Atlantic analyst Alexander Haissl initiated coverage with a Sell rating. The research firm set a price target of $175 on ORCL stock, reflecting a steep discount of about 40% from its current trading price.
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The bearish outlook stems from the analyst’s belief that the market is overestimating the value of Oracle’s cloud business, particularly its contracted revenues from Oracle Cloud Infrastructure (OCI).
Haissl suggests that Oracle’s role in large-scale, single-tenant cloud deployments is more like a lender than a typical cloud provider.
Analyst Warns of Valuation Risk
According to his analysis, Oracle’s five-year OCI revenue guidance translates to about $60 billion in value. He believes this reflects an overly optimistic scenario unlikely to play out.
While investors are focused on headline growth numbers, Haissl expects scrutiny to shift toward the underlying economics, especially as non-IaaS (non-infrastructure) growth remains weak.
Taken together, these factors suggest significant downside risk, prompting the analyst to initiate coverage with a bearish outlook.
Oracle Launches AI Tool to Monitor Farming
Moving ahead with its AI product launches, Oracle introduced a new AI tool to help governments monitor and manage agricultural activity more efficiently. It uses satellite images and machine learning to check crop health, spot problems early, and improve how resources are used across farms.
The tool will give real-time updates to help governments protect food supplies, predict crop yields, and make faster, smarter farming decisions.
Oracle’s newly-appointed Co-CEO, Mike Sicilia, said, “With current advances in cloud computing, AI, and satellite technology, we can completely transform agriculture operations to support more predictable outputs.”
Is Oracle a Buy, Sell, or Hold?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on ORCL stock based on 26 Buys, eight Holds, and one Sell assigned in the past three months. Further, the average ORCL price target of $338.37 per share implies 15.87% upside potential.
