Key Highlights
- Oracle shares advanced 2% to reach $157.13, extending Thursday’s 5.7% surge sparked by Federal Reserve commentary
- Morgan Stanley increased its price target to $210 from $207, pointing to enhanced GPU-as-a-Service margin performance
- Bernstein maintained its Outperform stance, indicating Oracle could be approaching the conclusion of its capital-raising phase
- Jefferies maintained Buy but lowered its target from $320 to $290, emphasizing OCI revenue expansion and margin metrics
- Q1 fiscal 2027 earnings scheduled for September 10, 2026, following market close
Oracle shares are trading 2% higher in morning sessions at $157.13, as Wall Street firms release updated analysis and market participants prepare for the upcoming quarterly earnings announcement next week.
This upward movement follows Thursday’s robust 5.7% gain, which came after Federal Reserve Governor Christopher Waller indicated support for maintaining current interest rates until additional inflation metrics are available. This development carries particular significance for Oracle, given the company’s substantial debt load accumulated to finance its artificial intelligence data center expansion.
Morgan Stanley increased its price objective to $210 from the previous $207, while maintaining an Equalweight stance. This adjustment reflects enhanced gross margin projections for Oracle’s GPU-as-a-Service operations. The firm applied approximately 19 times its calendar 2028 non-GAAP EPS projection of $10.98 in determining the new target.
The technology giant remains approximately 20% lower year-to-date, currently trading below its historical valuation metrics. Oracle’s PEG ratio stands at 0.77, with InvestingPro identifying the stock as undervalued when measured against near-term earnings potential. The company has maintained a 66% gross profit margin throughout the trailing twelve months.
Wall Street Coverage Before Results
Bernstein reaffirmed its Outperform designation and indicated Oracle might be nearing the conclusion of its capital-raising requirements. This would represent a significant transition for a corporation that has relied extensively on debt financing to support its AI infrastructure expansion. Bernstein additionally noted Oracle’s potential to emerge as the third-largest hyperscaler in the market.
Jefferies retained its Buy recommendation while reducing its price objective to $290 from $320. The firm identified 115% OCI revenue growth and a 41% operating margin as critical metrics for investors to monitor.
Mizuho also confirmed an Outperform rating alongside a $320 price objective, referencing an enhanced agreement with the Department of Veterans Affairs. The contract’s ceiling was raised by approximately $17 billion with possible extensions through May 2031.
September 10 Earnings Focus
Options market activity suggests a possible 10% price swing in either direction following Oracle’s Q1 fiscal 2027 earnings release on September 10, scheduled after market hours.
The broader equity market is providing minimal support for Oracle today. The S&P 500 has declined 0.1% while the Nasdaq maintains slight positive territory. Oracle’s movement appears driven by company-specific catalysts.
Morgan Stanley identified execution challenges and constrained free cash flow throughout the projection period as primary factors supporting its Equalweight rating despite the elevated price target.
Jefferies has highlighted OCI growth rates and margin expansion as the most definitive indicators of whether Oracle’s AI data center investments are delivering tangible financial results.
The Veterans Affairs contract enhancement, spotlighted by Mizuho this week, incorporates optional extension periods potentially extending the arrangement through May 2031, providing Oracle with sustained government revenue visibility.
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