Wedbush Securities says Oracle is on track to become a leading infrastructure provider for artificial intelligence models, which should boost its stock price. The research firm gave the software giant an Outperform rating. The stock is also rated $225, suggesting an upside of 27.6% from Thursday’s closing price. “While we believe Oracle is on a path to becoming the foundational infrastructure provider for the AI revolution, the market has fundamentally misinterpreted the company’s aggressive contract-backed investment cycle as a speculative risk,” analyst Dan Ives said in a note to clients. He noted that Oracle is in the “early stages of a significant repositioning.” Ives added that Oracle executives have already signed deals with Silicon Valley powerhouses to move their business closer to that goal. In 2025, Oracle agreed to sell $300 billion worth of computing power to OpenAI over five years starting in 2027. The AI infrastructure company also signed an agreement with Nvidia to accelerate enterprise AI by integrating Oracle Cloud Infrastructure (OCI) with Nvidia’s full-stack AI computing platform. Despite the cash flow from these deals, some investors are concerned that Oracle is allocating too much money to its infrastructure efforts. But Ives says those concerns are largely overblown. “The downside to Oracle is centered on capital expenditures and negative free cash flow,” Ives wrote. “However, we argue that this view is backward-looking and fails to understand the scale of contract demand that will support the investment.” Ives also noted that Oracle has several sources of capital available to continue operations. “Oracle is raising $45 billion to $50 billion in capital, and ORCL has already raised $30 billion in a combination of investment-grade debt and mandatory convertible preferred stock. This is a strategic move to strengthen its balance sheet and ensure it has the resources it needs to meet its contractual obligations,” the analyst said. Ives’ call echoes the consensus on the street. Of the 46 analysts covering Oracle, 35 rate the stock as a buy or strong buy, according to LSEG. The stock price has increased 28% over the past year. But it fell nearly 10% in 2026 amid continued concerns about AI companies’ eye-popping capital spending.
