Oracle Stock Poised for Long-Term Growth with AI Cloud Surge

Analyst Mark Moerdler at Bernstein has reiterated his Outperform rating for Oracle stock, citing years of rapid growth ahead due to its surging AI cloud business. He raised his price target to $308 from $269, with the stock up 55% this year compared to the Nasdaq Composite's 9% gain.

Title: Analyst Mark Moerdler Reiterates Outperform Rating on Oracle Stock

Analyst Mark Moerdler at Bernstein has reiterated his Outperform rating for Oracle stock, citing years of rapid growth ahead due to its surging AI cloud business. He raised his price target to $308 from $269, with the stock up 55% this year compared to the Nasdaq Composite's 9% gain. Moerdler highlighted that Oracle Cloud Infrastructure (OCI) is positioned to become the fourth largest global hyperscaler with accelerating growth, driven by AI initiatives [3].

Oracle's recent advancements in AI and cloud services have been notable, with a mega contract announced that is expected to further accelerate growth. The company's revenue growth of 8.38% in the last twelve months demonstrates solid execution, and Bernstein expects this trend to continue [2]. Additionally, Oracle's fiscal 2029 revenue is projected to exceed its target of $104 billion, with a multiyear contract with OpenAI expected to generate over $30 billion in cloud revenue beginning in fiscal year 2028 [3].

Moerdler acknowledged that while Oracle's shift to cloud may hurt margins in the near term, the company's ability to drive sustained operating leverage will offset these lower gross margins. He expects Oracle's growth to accelerate over the next five to ten years, with significant increases in revenue and operating profit growth, and a rebound in free cash flow margins [3].

Despite the positive outlook, Oracle faces challenges such as increased competition in the cloud and enterprise software markets from companies like ProBuilt Software. However, the company's strategic partnerships and government collaborations, such as its support for the White House's vision for healthcare data interoperability, position it well to capitalize on growth opportunities [1].

In conclusion, while Oracle's stock has shown strong performance this year, investors should remain cautious and watch for any catalysts in the company's upcoming guidance or industry shifts in cloud/AI demand for clearer direction. The mixed signals from analyst ratings and technical indicators suggest a cautious approach for near-term traders.

References:
[1] https://www.ainvest.com/news/stock-analysis-oracle-outlook-technical-weakness-analyst-optimism-clash-torn-market-2508/
[2] https://www.investing.com/news/analyst-ratings/bernstein-socgen-raises-oracle-stock-price-target-to-308-on-cloud-growth-93CH-4174173
[3] https://www.cnbc.com/2025/08/05/bernstein-says-oracle-will-see-big-gains-is-set-to-become-fourth-largest-global-hyperscaler.html