Technology
59/100
59/100Is ORCL-Oracle a buy?
Friday 11 September 2026
Why now: Oracle reported a fresh quarter of exceptional cloud-infrastructure demand and the shares are up 2.76% to $157.16 today. The short-term setup is still incomplete, but the earnings update makes execution on artificial intelligence capacity the central issue for the next year.
Upside: The Wall Street consensus target is $240.55, implying 52.9% upside from the current price. That outcome depends on Oracle converting its contracted demand and remaining performance obligations into delivered, profitable cloud capacity.
Risks: The main risk is that data-center spending stays ahead of cash generation for too long. A weaker customer spending cycle, capacity-delivery delays, or higher borrowing costs would pressure the valuation quickly.
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Scorecard
Read:Strong metricsSolid metricsSelectiveCautionUnfavourableN/A
| Scorecard | 59/100 | |
|---|---|---|
| Company Detail | ORCL - Oracle Corporation | |
| Price as at 11 September 2026 | $157.16 | |
| Market cap | $453.0B | |
| Quality and Fundamental Score (100) | ||
| Breakout / Early-Momentum /20 | 0/20 | |
| Rev/EPS Momentum /20 | 18/20 | |
| Business Quality /15 | 14/15 | |
| Balance Sheet /15 | 7/15 | |
| Valuation /10 | 7/10 | |
| Industry Relative Strength /10 | 3/10 | |
| Macro / Sector Tailwind /10 | 10/10 | |
| Growth | ||
| Cash runway | 1.5 yr | |
| Revenue YoY | +17.4% | |
| EPS YoY | +34.3% | |
| FCF YoY | -5911.7% | |
| Gross margin | 65.2% | |
| Valuation & Trend | ||
| Trailing P/E | 24.3x | |
| Forward P/E | 19.5x | |
| RSI (14d) | 57 | |
| vs 50d SMA | +11.6% | |
| Support cushion | −11.1% | |
| Sentiment | ||
| Wall Street verdict | Aligned | |
| News tone | Mixed | |
| Dividend | 1.3% | |
How are these colored?
| Metric | Strong metrics | Solid metrics | Selective | Caution | Unfavourable |
|---|---|---|---|---|---|
| Overall score | ≥ 80 | 70-79 | 60-69 | 50-59 | < 50 |
| Business quality /15 | ≥ 12 | 10-11 | 8-9 | 6-7 | < 6 |
| Balance sheet /15 | ≥ 12 | 10-11 | 8-9 | 6-7 | < 6 |
| Market cap | ≥ $20B | $5B-$20B | $2B-$5B | $1B-$2B | < $1B |
| Cash runway | ≥ 3 yr or cash generative | 1.5-3 yr | 0.75-1.5 yr | 0.25-0.75 yr | < 0.25 yr |
| Revenue YoY | ≥ 15% | 5-15% | 0-5% | -5-0% | < -5% |
| EPS YoY | ≥ 20% | 5-20% | 0-5% | -5-0% | < -5% |
| FCF YoY | ≥ 10% | 1-10% | 0-1% | -5-0% | < -5% |
| Gross margin | ≥ 60% | 40-60% | 25-40% | 10-25% | < 10% |
| Trailing P/E | < 15 | 15-25 | 25-35 | 35-40 | > 40 or neg |
| Forward P/E | < 15 | 15-25 | 25-35 | 35-40 | > 40 or neg |
| RSI (14d) | 50-70 | 45-50 or 70-75 | 40-45 or 75-78 | 30-40 or 78-80 | < 30 or > 80 |
| vs 50d SMA | +2% to +15% | 0-2% or 15-25% | -2-0% or 25-35% | -3--2% or 35-40% | < -3% or > 40% |
| Support cushion | 2-10% above | 0-2% | 10-15% | 15-20% | price below support |
| Wall Street verdict | Aligned | — | Mixed | — | Disagrees |
| News tone | Positive | — | Neutral / Mixed | — | Negative |
| Dividend | Yield ≥ 2% & growing | Growing | Flat payer ≥ 1% | Low / flat | Cutting |
Detailed Analysis — Friday 11 September 2026
What they do
Oracle sells database software, cloud infrastructure, business applications, and industry software to enterprises and governments. It earns recurring revenue from subscriptions, cloud consumption, support contracts, and software licenses.
Leadership
Clayton MagouyrkCEO
Clayton Magouyrk has been Chief Executive Officer and a director of Oracle since September 2025.
Hilary Barbara MaxsonCFO
Hilary Barbara Maxson has been Chief Financial Officer of Oracle since April 2026.
Customers & notable contracts
Receiver of capital expenditure: Yes: Oracle is a direct receiver of enterprise and government capital spending because customers are committing funds to cloud capacity, data centers, databases, and artificial intelligence computing.
Main customers
- OpenAI (Uses Oracle Cloud Infrastructure capacity as part of its broader artificial intelligence computing expansion.)
- Microsoft (Oracle Cloud Infrastructure extends capacity for the Microsoft Azure artificial intelligence platform serving OpenAI workloads.)
- United States government agencies (Federal civilian, defense, and intelligence customers can procure Oracle Cloud services through existing government contract vehicles.)
Notable contracts
- OpenAI and Oracle Cloud Infrastructure capacity arrangement (Oracle provides cloud infrastructure capacity to support OpenAI's expanding artificial intelligence workloads.)
- Stargate data-center expansion (Oracle is participating in new artificial intelligence data-center sites with OpenAI, SoftBank, and infrastructure partners.)
- Oracle federal cloud contract vehicles (Government buyers can obtain Oracle cloud services through established federal purchasing programs.)
Summary thesis
- Oracle has evolved from a mature database and enterprise-software vendor into a major supplier of cloud capacity for artificial intelligence workloads.
- Its installed base, database position, multicloud relationships, and growing infrastructure footprint give it a credible path to sustain faster growth than traditional enterprise-software peers.
- The investment case is strongest if management can keep adding capacity without sacrificing returns on capital or overextending the balance sheet.
Wall Street alignment
Wall Street: Mostly aligned (2/4 positive)
Analyst consensus
Buy (2.40, 86 analysts) · +53% upside
Institutional ownership
46% institutions, insiders 40.5%
Short interest
2.6% of float short · 1.8 d-to-cover
Smart money tape
+0 net (acc 1 / dist 1, last 26d)
Recent news
News Mixed · last 7d
Show 2 headlines from the last 7d
2026-09-10Earnings+supportive
First-quarter revenue rose 30 percent to $19.3 billion, led by 121 percent growth in cloud infrastructure revenue. Oracle forecast second-quarter revenue growth of 30 percent to 34 percent and raised its full-year non-GAAP earnings per share outlook to $8.10, while remaining performance obligations reached $664 billion.
2026-09-09Analyst−challenging
Scotiabank cuts Oracle price target while maintaining outperform rating ↗ · PriceTargets.com
Scotiabank lowered its Oracle price target to $215 from $241 but retained its Sector Outperform rating. The target reduction signals a more cautious valuation view ahead of Oracle's quarterly report.
Dividends
Yield (fwd)
1.27%
Latest (TTM)
$2.00
2025
$1.90
2024
$1.60
Payout ratio: 31%
Technicals
Price
$157.16
RSI (14d)
56.7
50d SMA
$140.82
200d SMA
$167.68
vs 50d SMA
+11.6%
vs 200d SMA
-6.3%
Support (swing low)
$139.72 −11.1%
Next swing high (swing high)
$165.39 +5.2%
Close as of 2026-09-11.
Score breakdown
Scores 59 out of 100. a mixed overall grade. Sector fit, business quality, and earnings trend scored highest. Valuation was fair but not a standout driver. Balance sheet and relative strength versus its industry weighed on the total. The operating story is strong, but the technical data do not show a qualifying breakout or rising long-term trend. Free cash flow is negative because Oracle is funding a very large infrastructure build, leverage is elevated, and the stock's industry-relative strength is weak.
Component scores are on the scorecard above.
Momentum evidence
- The current price is $157.16, following a 2.76% gain from the prior close after the earnings release.
- That reaction is encouraging, but the completed daily-bar dataset lacks usable moving averages, relative positioning, volume confirmation, and a defined resistance level; it also shows a negative 90-day return, no confirmed breakout, and a non-rising 200-day average.
- Oracle is underperforming its technology sector neighborhood, with an industry-relative-strength score of 31.2 despite XLK gaining 2.5% over 20 days.
Fundamental evidence
- Oracle generated $67.36 billion of annual revenue and $17.09 billion of net income, with a 65.2% gross margin, 42.5% return on equity, and a 1.27% dividend yield.
- The red flag is free cash flow of negative $23.69 billion as the company funds major cloud and data-center expansion.
- Liquidity is adequate with $36.37 billion of cash and a 1.17 current ratio, but net debt to earnings before interest, taxes, depreciation, and amortization is 3.51 times and the Altman Z-score of 1.68 calls for careful balance-sheet monitoring.
Cash runway: 1.5 yr ($36.4B cash ÷ $23.7B/yr burn, latest fiscal year).
Valuation view
Oracle trades at 24.3 times trailing earnings and 19.5 times forward earnings, which is reasonable for a company now producing faster cloud growth but not cheap when measured against its negative free cash flow. Enterprise value is 8.0 times sales and 16.8 times earnings before interest, taxes, depreciation, and amortization. The multiple assumes that the current infrastructure build will produce a much larger recurring revenue base and ultimately restore strong cash conversion.
Macro tailwind
Artificial intelligence training, inference, and enterprise deployment require large amounts of computing capacity, networking, storage, databases, and secure cloud services. Oracle is positioned to capture part of that spending through its cloud infrastructure, multicloud database services, and enterprise application base.
What to watch
Upcoming (1–6 months)
- Fiscal second-quarter results and management's update on cloud-capacity delivery, customer demand, and capital-spending plans.
Ongoing
- Free-cash-flow recovery, net debt, remaining performance obligations, cloud infrastructure growth, and whether shares establish a sustained technical base.
Long-term case
Over a multi-year horizon, Oracle can benefit from three reinforcing assets: a deeply embedded enterprise database franchise, a large base of application customers, and cloud infrastructure built for demanding artificial intelligence workloads. The company can also sell cloud services around customers' existing Oracle databases and applications rather than asking them to replace core systems. Durable success requires that this expansion becomes a high-return recurring business rather than a cycle of ever-larger capital commitments.
Risks & invalidation
Risks
- Artificial intelligence demand could prove less durable than current contracts and customer announcements imply, leaving Oracle with expensive capacity and lower returns.
- Competition from Amazon Web Services, Microsoft Azure, Google Cloud, and specialized infrastructure providers could compress pricing or limit Oracle's share.
- High capital spending, negative free cash flow, and leverage reduce flexibility if interest rates remain elevated or execution slips.
Breaks the thesis
- The long-term case weakens materially if cloud growth slows while capital spending remains elevated and free cash flow does not move back toward positive territory.
Bottom line
Oracle is becoming a more important cloud-infrastructure supplier for artificial intelligence while retaining the recurring software base that made the company durable in the first place. The next one or more years depend less on demand headlines and more on whether management can deliver data-center capacity, preserve margins, and turn spending back into cash generation. The business opportunity is real, but its capital intensity and weak current chart position make execution the decisive swing factor.