Oracle (ORCL), one of the world’s largest enterprise software companies, is down about 29% year-to-date even as it pushes deeper into the AI race. The company’s backlog has climbed to $553 billion as of Q3 FY26, highlighting strong demand for its AI offerings.
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However, rising costs to support that growth are starting to raise concerns. Recently, Ari Terjanian of Cleveland Research reinforced those worries, downgrading the stock to Neutral and pointing to the high cost of building AI infrastructure.
Following Oracle’s recent AI event in New York, the stock has become a topic of debate on Wall Street, with some analysts staying bullish on its long-term opportunity, while others remain cautious about execution and higher AI spending.
Why Bulls Are Turning More Positive
Recently, Mizuho analyst Siti Panigrahi reiterated a Buy rating with a $400 price target, highlighting Oracle’s strong cloud setup. She noted that its infrastructure is difficult for competitors to replicate, giving it a lasting edge.
More importantly, Panigrahi is seeing a shift in how companies adopt AI. Instead of moving data to new platforms, businesses want to bring AI to their existing data. Since Oracle already manages large amounts of enterprise data, this trend works in its favor.
At the same time, Oracle is not just offering infrastructure. It is building a full stack — from cloud to database to business applications. Its new AI tools for areas like customer experience, HR, and supply chain show how it plans to expand across the entire workflow.
This view was echoed by KeyBanc analyst Jackson Ader, who maintained an Overweight rating and a $300 price target. He pointed out that Oracle’s opportunity spans multiple layers — infrastructure, applications, and data — making it a broad AI play.
Why Others Are Getting More Cautious
Despite the strong demand story, not all analysts are convinced. Recently, Terjanian has pointed to the cost side of the equation. To support its AI growth, Oracle is building out large data centers and infrastructure. Reports suggest the company may raise up to $50 billion to fund this expansion.
The issue is that this expansion comes with significant upfront spending, while the revenue from these investments may take time to fully materialize. Until then, profit margins could face pressure.
Is ORCL Stock a Good Buy?
Turning to Wall Street, analysts have a Strong Buy consensus rating on ORCL stock based on 27 Buys, six Holds, and zero Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the average ORCL price target of $245.11 per share implies 77.5% upside potential.
