Oracle (ORCL) Could Surge Higher as Analysts Highlight Major AI Growth Potential

Oracle Corporation (NYSE:ORCL) is one of the AI Stocks in Focus This Week. On December 1, Deutsche Bank reiterated its Buy rating on the stock with a $375.00 price target. The firm is confident about Oracle’s long-term AI growth and sees favorable risk/reward.

Oracle shares are trading at 27x consensus CY26 EPS, reflecting upfront costs in scaling its AI business. Due to this, investor appetite for growth seems limited until there are more visible results.

Even though Deutsche Bank acknowledges these risks, it believes that they are offset by the very real opportunity presented by OpenAI. OpenAI backlog represents solid ROI business and “validates Oracle's leadership in deploying AI cloud infrastructure at scale.”

As such, the recent pullback serves as a good opportunity which skews to the upside.

"This exercise intends to help frame the risk/reward currently embedded in shares, which we'd argue skews strongly to the upside and amidst the pullback presents an attractive entry point for investors when looking at Oracle's business in totality. We reiterate our Buy rating and DCF derived target price of $375, which implies ~38× our CY27E non-GAAP EPS."

Oracle Corporation (NYSE:ORCL) is a database management and cloud service provider.

While we acknowledge the potential of ORCL as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

READ NEXT: 10 AI Stocks Making Headlines on Wall Street and 10 AI Stocks on the Market’s Radar

Disclosure: None.