Oracle Is Down 53% in a Year and Trades at 15 Times Earnings. Wall Street Still Sees $230+
Oracle's cloud backlog is exploding and Wall Street analysts are nearly unanimous in calling it a buy, yet the stock keeps sliding. Something has to give, and figuring out which side breaks first could determine whether this is the year's…
Oracle (NYSE:ORCL | ORCL Price Prediction) trades at $130.34. That is 53.07% lower than a year ago, and the stock is priced at roughly 15x forward earnings.
The 24/7 Wall St. price target for Oracle is $200.50 over the next 12 months, which means 53.8% upside. The stock earns a buy rating with high confidence from our model.
24/7 Wall St. Price Target Summary
| Metric | Value |
|---|---|
| Current Price | $130.34 |
| Price Target from 24/7 Wall St. | $200.50 |
| Upside | 53.8% |
| Recommendation | BUY |
| Confidence Level | 90% |
The stock has fallen while the business has sped up. Cloud infrastructure revenue grew 121% last quarter, and remaining performance obligations reached $664B. Wall Street’s consensus target of $235.80 sits more than 80% above today’s price.
Record Cloud Growth Collides With a 32% Slide in 2026
Oracle is down 0.61% over the past week, 4.59% over the past month and 32.24% year to date. Shares sit about 51% below the 52-week high of $266.20 and roughly 14% above the $114.08 low.
Fiscal Q1 2027 revenue came in at $19.345B, up 29.6% and ahead of the $19.129B consensus. Non-GAAP EPS of $1.92 beat the $1.74 estimate.
Even so, the stock gave back its post-earnings gain and ended the day down nearly 2% because investors are worried about how Oracle will pay for its datacenter buildout (we covered seven of the power, cooling, and networking suppliers riding that same expansion in a free AI infrastructure report). This week, Oracle expanded its OpenAI partnership, and the stock rose on the news.
Why Bulls See $286 Ahead
Management expects about half of the RPO to convert into sales over the next 36 months. GPU utilization was 97.9%, and capacity that came up for renewal was renewed or resold at a 20% premium.
Oracle raised full-year guidance to at least $90B in revenue and $8.10 in non-GAAP EPS. Among analysts, 35 rate the stock a buy or better and only 1 rates it a sell. In our bull case, the stock reaches $286.12.
Cash Burn and Debt Are the Risks Worth Watching
Free cash flow was -$5.396B last quarter after -$23.686B in fiscal 2026. Interest expense rose 55% to $1.4B, and Oracle plans to raise about $40B in debt and equity this fiscal year. Software license revenue fell 15%.
There is a contrast. Net cash capex after customer prepayments was $18 billion, and management says each project converts roughly 100% to post-tax EBITDA into free cash flow once it ramps. The bear case of $171.15 still sits above today’s price.
Oracle Trades at a Steep Discount to Microsoft and Amazon
Microsoft (NASDAQ:MSFT) competes head-on with Oracle for AI cloud workloads through Azure. Shares trade at 26x forward earnings while its revenue grows 17.7%.
Amazon (NASDAQ:AMZN) runs AWS, the infrastructure leader Oracle is trying to catch, and trades at 23x forward earnings with 19.6% growth. Oracle grows faster than both at a much lower multiple. Next to these peers, the 24/7 Wall St. price target looks conservative.
| Company | Forward P/E | Revenue Growth (YoY) |
|---|---|---|
| Oracle | 15x | 29.6% |
| Microsoft | 26x | 17.7% |
| Amazon | 23x | 19.6% |
Oracle Price Prediction 2026-2030
The 24/7 Wall St. price target is $200.50, with a buy rating and 90% confidence. What decides it for me is a forward multiple near 15x on a backlog that is already becoming into revenue.
The case gets stronger if net capex stays within the $70 billion cap. I would get more conservative if funding needs grow beyond the planned raise.
Our model projects where Oracle could trade if current growth trends and market conditions hold.
| Year | Bear | Base | Bull |
|---|---|---|---|
| 2026 (12-month target) | $171.15 | $200.50 | $286.12 |
| 2028 | $191.92 | $263.65 | $396.50 |
| 2029 | $207.87 | $316.35 | $551.62 |
| 2030 | $234.93 | $377.80 | $669.05 |
The projections rest on Oracle continuing to execute its current strategy. The biggest key factors are how fast the RPO converts to revenue and whether OpenAI keeps spending at its current rate.
Contact [email protected] for any questions or corrections.
Vandita Jadeja is a financial publisher with over a decade of experience writing about financial topics, including investment, savings, retirement, insurance and banking. Vandita is a Chartered Accountant who loves to debunk financial concepts for readers.
Her work has appeared on sites that include The Motley Fool, InvestorPlace, and Benzinga. She covers investing and focuses on stock picks and price prediction for 24/7 Wall St.
When not looking for the next stock investment opportunity, she can be found traveling, reading, chasing sunsets and enjoying her iced latte.
