Oracle’s stock is nursing a double-digit decline since January, yet Wedbush Securities is stepping into the fray with a bullish call that flies in the face of mounting skepticism. Analyst Daniel Ives has initiated coverage with an “Outperform” rating and a $225 price target, arguing that the market has fundamentally misread the company’s aggressive capital spending spree.
The core of Ives’ thesis rests on a simple premise: Oracle’s billions in infrastructure investment are not speculative gambles but are backed by binding customer contracts. Central to this strategy is the Oracle Cloud Infrastructure (OCI), whose flatter network design delivers lower latency and faster compute power for AI workloads. That technical edge, Wedbush contends, positions OCI as a cost-effective platform for training large language models.
The numbers lend weight to that argument. Oracle has locked in a staggering $300 billion commitment to supply compute capacity to OpenAI starting in 2027. Meanwhile, the company is embedding Nvidia’s AI platform into its own infrastructure. To fund this buildout, Oracle has already secured a significant portion of the fresh capital it’s raising.
The multi-cloud story adds another layer of momentum. In the third fiscal quarter of 2026, revenue from multi-cloud databases surged 531% year-over-year, fueled by expanded partnerships with Google Cloud and Amazon Web Services. Total revenue over the trailing twelve months reached $64.1 billion, a nearly 15% increase.
The Skeptics Have Their Say
Yet for every bullish signal, there’s a counterweight. Oracle recently canceled a massive server rack order with supplier Super Micro Computer worth over $1 billion. That move triggered a price target cut from Morgan Stanley, which lowered its target from $213 to $207 while maintaining an “Equalweight” rating. The concern: lack of transparency around margins in the growing GPU-as-a-Service business.
Should investors sell immediately? Or is it worth buying Oracle?
Adding to the unease, a shareholder lawsuit has been filed alleging misleading statements about Oracle’s AI strategy. The stock now trades at €148.62 (approximately $153.84), down roughly 11% year-to-date and about 45% below its 52-week high of €280.70. The Relative Strength Index sits at around 21, deep in oversold territory, and the shares trade well below their 200-day moving average.
A Divided Wall Street
The broader analyst consensus remains cautiously optimistic. Of the 33 analysts covering Oracle, 27 rate it a buy, six recommend holding, and the average price target stands at $244.89. That’s nearly 30% above current levels, suggesting the selloff may have gone too far.
The immediate hurdle is Oracle’s planned capital expenditure of roughly $50 billion for fiscal 2026. Management faces a critical test in the upcoming earnings season: converting record order books into actual revenue growth. If the company can demonstrate that its AI infrastructure investments are translating into earnings, the bull case gains traction. If margins remain opaque, the skepticism will only deepen.
For now, Wedbush is betting on the former. The question is whether the rest of the market will follow.
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