Bernstein Reiterates “Buy” Rating on Oracle Corporation (ORCL) with $364 PT

Core Insights - Artificial intelligence (AI) is identified as the greatest investment opportunity of the current era, with a strong emphasis on the urgent need for energy to support its growth [1][2][3] - A specific company is highlighted as a key player in the AI energy sector, owning critical energy infrastructure assets that are essential for meeting the increasing energy demands of AI technologies [3][7] Investment Landscape - Wall Street is investing hundreds of billions into AI, but there is a looming question regarding the energy supply needed to sustain this growth [2] - AI data centers consume energy equivalent to that of small cities, leading to concerns about power grid strain and rising electricity prices [2] - The company in focus is positioned to capitalize on the surge in demand for electricity driven by AI advancements [3][6] Company Profile - The company is described as a "toll booth" operator in the AI energy boom, benefiting from the increasing need for energy infrastructure [4][5] - It possesses significant nuclear energy infrastructure assets, making it a pivotal player in the U.S. energy strategy [7] - The company is noted for its capability to execute large-scale engineering, procurement, and construction projects across various energy sectors [7] Financial Position - The company is completely debt-free and has a substantial cash reserve, amounting to nearly one-third of its market capitalization [8] - It is trading at less than 7 times earnings, indicating a potentially undervalued investment opportunity [10] Market Trends - The company is linked to the onshoring trend driven by tariffs, which is expected to boost domestic manufacturing and energy needs [5][14] - There is a growing interest from hedge funds in this company, suggesting it is gaining recognition as a valuable investment [9][10] Future Outlook - The future of AI is closely tied to energy advancements, with a strong emphasis on the need for innovative energy solutions to support AI growth [12][13] - The company is positioned to benefit from the anticipated AI infrastructure supercycle and the surge in U.S. LNG exports [14]