Oracle Up 18.4% in a Year: Buy, Sell or Hold the Stock?

Core Insights - Oracle Corporation has shown strong stock performance, with an 18.4% increase over the past year, outperforming the Zacks Computer and Technology sector and the S&P 500 [1] - The company's growth is attributed to its strategic shift towards cloud infrastructure and AI technologies, with Q3 fiscal 2025 revenues rising 6% year-over-year to $14.1 billion, primarily driven by cloud services [2] Financial Performance - Oracle's remaining performance obligations (RPOs) have increased significantly to$130 billion, reflecting a 63% rise in constant currency, indicating strong future revenue potential [3] - Cloud services and license support revenues grew by 10% to $11.0 billion, while cloud infrastructure revenues surged by 51$57.12 billion, representing a year-over-year growth of 7.86%, with earnings estimated at $6.05 per share, reflecting an 8.81$16 billion in fiscal 2025, which may pressure free cash flow [8] - Infrastructure expansion faces potential constraints due to component delays, which could limit revenue growth despite strong demand [9] - Oracle's current valuation, with an EV/EBITDA multiple of 19.92, is above the industry average, suggesting limited margin of safety for investors [10] Conclusion - Oracle holds a Zacks Rank 3 (Hold), indicating that current shareholders may consider holding their positions due to the company's strategic focus on high-growth markets [11] - Prospective investors may benefit from waiting for a more favorable entry point or clearer evidence of sustainable revenue growth and margin improvement [12]