Citi analyst Tyler Radke remains optimistic on Oracle Corp. (NYSE: ORCL) despite recent volatility in the stock.
In a new note to clients, Radke raised his price target to $415 per share, up from $395 previously, implying an upside of nearly 40% from current levels.
He also reiterated his buy rating, signaling continued confidence in the software giant’s long-term growth trajectory.
Oracle shares have fallen nearly 10% over the past month amid broader market concerns about the stability of the artificial intelligence (AI) trade.
The pullback follows a strong first quarter, during which Oracle reported historic results.
According to Radke, this recent weakness offers investors a “buying opportunity,” as the company’s fundamentals and AI-driven growth prospects remain intact.
Oracle shares gained over 1.5% in premarket trading.
AI demand expected to drive Oracle cloud growth
Radke’s bullish stance centers on Oracle’s expanding cloud infrastructure business (OCI), which he sees as a key growth engine.
He noted that the company continues to experience strong bookings momentum, largely driven by escalating demand for AI infrastructure from leading technology customers.
“We view the pullback as a buying opportunity as we see a broadening set of customers powering OCI growth,” Radke wrote.
He added that Oracle’s management is expected to provide greater clarity around capital expenditures (CapEx), financing needs, and long-term profitability related to its rapidly growing AI projects.
The analyst emphasized that Oracle’s cloud infrastructure ramp is “significant,” with AI demand fueling capacity expansion.
As organizations increasingly invest in AI systems that require large-scale computing resources, Oracle’s infrastructure-as-a-service platform has been a key beneficiary.
Addressing profitability and backlog concerns
Investors have grown cautious in recent weeks over issues such as backlog quality and profitability, following a series of press reports questioning the sustainability of AI-driven demand.
Broader market skepticism about an “AI bubble” has also contributed to short-term pressure on Oracle shares.
However, Radke believes these fears are overdone. He specifically pointed to concerns surrounding recovery point objective (RPO) — the measure of how much data loss a client can tolerate — as exaggerated.
He expects that stronger AI infrastructure demand and continued customer diversification could help offset these worries over time.
Furthermore, Radke sees “substantial potential for upward revisions” in Oracle’s earnings estimates heading into fiscal year 2028.
The ongoing ramp in AI-related projects, he said, could help balance out near-term margin pressure and provide additional support for the company’s earnings growth.
Upcoming AI event seen as potential catalyst
Looking ahead, Oracle’s AI World event in Las Vegas next week could serve as a near-term catalyst for the stock.
The conference is expected to highlight new product developments, partnerships, and customer adoption trends within Oracle’s AI and cloud infrastructure businesses.
With Oracle positioned at the intersection of enterprise software and AI infrastructure, Citi’s Radke remains confident that the company’s long-term growth story is intact.
Despite recent turbulence in the stock, he views the current environment as an opportunity for investors to gain exposure to one of the sector’s key players in the evolving AI ecosystem.
At a $415 price target, Citi’s outlook reflects continued conviction that Oracle’s expanding AI infrastructure capabilities will drive sustainable value creation in the years ahead.
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