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Will Oracle’s (ORCL) AI Bet Pay Off After Multi-Billion-Dollar AI Data Center Deals?
Yahoo Finance· 2025-10-31 14:50
Core Insights - Oracle Corp. is considered one of the best stocks to buy according to Citadel LLC, with BMO Capital Markets analyst Keith Bachman reaffirming an Outperform rating and a price target of $355 [1][2] Group 1: Growth Potential - Oracle's long-term growth is expected to be driven by its Oracle Cloud Infrastructure (OCI) and database businesses, which are projected to expand due to the company's focus on these areas [2] - As these businesses scale, profitability is anticipated to improve with better operating margins, supporting earnings growth [2] - The potential for enhanced profitability in its Infrastructure-as-a-Service (IaaS) portfolio has been particularly highlighted [2] Group 2: AI Integration - The integration of AI into Oracle's database and cloud solutions is expected to lead to deeper customer adoption and broader monetization across its platform [3] - Oracle's recent multi-billion-dollar data center deals with customers like OpenAI and Meta Platforms are under scrutiny regarding the company's ability to deliver profitably [4] Group 3: Operational Challenges - Bank of America analyst Brad Sills noted that Oracle faces supply constraints across land, buildings, energy, and GPUs, which may impact the pace of facility delivery [4] Group 4: Product Offering - Oracle Corp. provides a comprehensive suite of database and cloud computing software and hardware, including databases, relational servers, application development tools, and enterprise business applications [5]