Oracle (ORCL) stock opened comfortably in the green this morning after reporting market-beating Q3 earnings and offering encouraging guidance for the current quarter. Following the post-earnings rally, ORCL is hovering just below its 50-day moving average (MA), with a clear break above $168 expected to further accelerate bullish momentum in the near-term.
Versus its year-to-date low, Oracle stock is now up some 20% — but a senior D. A. Davidson analyst, Gil Luria, believes it’s still inexpensive to own at current levels.
In a post-earnings interview with CNBC, Luria said Oracle’s current share price bakes in its legacy software and cloud operations only.
Since the company’s massive $553 billion artificial intelligence (AI) backlog is receiving “almost no credit” currently, investors are getting that fast-growing segment for free today.
In comparison, peers including Nebius (NBIS) and CoreWeave (CRWV) are trading at more than 1x their backlogs, reinforcing that ORCL stock is basically a bargain at 25x forward earnings, he added.
Luria’s base case calls for Austin-headquartered Oracle to reach $180 by year-end, indicating potential upside of more than 10% from here.
Luria also recommends owning Oracle shares because the firm’s operating margin stood at an exciting 32% in the third quarter. This means that ORCL is no longer just a stable, legacy name — it has actually evolved into a high-growth AI infrastructure stock.
The D. A. Davidson expert also downplayed concerns that AI could disrupt the company’s software business, saying “nobody is going to know how to use AI internally better than software firms.”
Note that the NYSE-listed multinational also currently pays a dividend yield of 1.34%, which makes it even more attractive as a long-term holding, at least for income-focused investors.
Other Wall Street analysts seem to agree with Luria’s bullish view on ORCL shares as well.
According to Barchart, the consensus rating on Oracle sits at “Strong Buy” currently, with the mean target of about $266 indicating potential upside of about 65% from here.
