Oracle stock gained early Thursday after it was upgraded to positive overweight by analysts at Piper Sandler. Shares of the enterprise technology giant rallied last week after Oracle disclosed it had landed several new cloud contracts, with a report that one of them is an expansion of its Stargate initiative with ChatGPT creator OpenAI.
The upgrade from Piper Sandler comes after a survey of chief information officers (CIOs) by the firm showed a "bullish spending backdrop" for AI infrastructure. The survey found that 27% of CIOs are planning a material increase in their spending with Oracle's cloud infrastructure offering. That was up from 18% in a December survey and 15% in a June 2024 survey.
"Rising enterprise demand could further augment the material OpenAI-Stargate AI training opportunity," Piper Sandler analyst Brent Bracelin wrote to clients Thursday.
Bracelin upped his rank for Oracle to overweight from the previous neutral and set a price target of 270 for the stock, compared to a previous 190.
On the stock market today, Oracle stock is up nearly 2% at 239.75 in recent premarket trading. Oracle stock is ahead 41.5% year to date as of Thursday morning. Last year, Oracle rallied 60% to post its best share price growth performance since 1999.
Oracle Stock Surges After Cloud Announcement
After surging 13% in trading last week, Oracle stock is hovering near record highs. Shares jumped after Oracle revealed through a regulatory filing last Monday it had landed "multiple large cloud services agreements."
That includes a deal Oracle said could contribute $30 billion in annual revenue starting with the company's fiscal 2028 (Oracle's fiscal 2026 started last month). The statement from Oracle didn't name the client behind the $30 billion deal. However, Bloomberg reported Wednesday that ChatGPT creator OpenAI had agreed to rent additional cloud capacity from Oracle as part of its Stargate partnership.
The disclosed contracts helped further boost investor confidence that Oracle's cloud infrastructure business can compete against cloud hyperscalers like Amazon, Microsoft and Google parent Alphabet to offer AI cloud-computing services.
Analysts with Jefferies boosted their price target for Oracle stock to 270 from 200 in a client note late Monday, which reiterated a buy call. Jefferies analyst Brent Thill called Oracle's newly announced cloud deals "a pivotal moment in its evolution as a hyperscaler."
The note from Piper Sandler Thursday, meanwhile, said the survey data for Oracle Cloud Infrastructure shows the platforms popular as the "fourth emerging IaaS platform," referring to cloud infrastructure-as-a-service.
Oracle expects cloud infrastructure revenue to grow 70% during fiscal 2026, the company told investors during its fiscal Q4 earnings results last month. Oracle's total cloud infrastructure revenue for its 2025 fiscal year was $10.3 billion.
