Oracle (ORCL): Rethinking Valuation After a Strong Recent Share Price Run

Oracle (ORCL) has quietly outpaced the broader software sector over the past year, and with shares near $198 investors are asking a simple question: is the recent run justified or stretched?

See our latest analysis for Oracle.

That question is more than fair given the backdrop, with a strong 7 day share price return and a solid year to date share price gain sitting alongside an impressive multi year total shareholder return that suggests long term momentum is still very much intact, even if shorter term swings reflect changing views on Oracle s growth and cloud risk profile.

If Oracle s move has you rethinking your tech exposure, it could be a useful moment to scout other high growth opportunities across high growth tech and AI stocks.

With earnings still growing at a healthy clip, a rich cloud narrative, and the stock trading at a steep discount to analyst targets, the core debate is simple: Is Oracle still undervalued, or is future growth already fully priced in?

Most Popular Narrative: 49.1% Undervalued

Oracle last closed at $198.38, while the most popular narrative argues its fair value sits far higher, implying substantial upside if those assumptions play out.

This strategic shift, defined by massive infrastructure investment, a landmark partnership with OpenAI, and the rise of colossal superclusters, has driven an unprecedented surge in its contract backlog, fundamentally reshaping Oracle’s long term growth trajectory and competitive landscape.

Read the complete narrative.

Want to see what justifies that kind of upside gap? The narrative focuses on aggressive revenue expansion, surging infrastructure demand, and a bold profit trajectory that recasts Oracle as hypergrowth. Curious how those moving parts combine into a near doubled fair value claim? Explore the full blueprint behind that call.

Result: Fair Value of $389.81 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, this bullish setup could unravel if Oracle stumbles on data center build out execution, or if AI infrastructure demand proves more cyclical than expected.

Find out about the key risks to this Oracle narrative.

Another Lens On Value

That bullish narrative collides with a very different signal from our SWS DCF model, which puts fair value nearer $164.47, implying Oracle is actually overvalued at today s $198.38 price. If cash flows say one thing and the growth story another, which do you trust more?

Look into how the SWS DCF model arrives at its fair value.

Build Your Own Oracle Narrative

If you see the story differently or want to stress test the assumptions with your own work, you can craft a fresh view in minutes: Do it your way.

A great starting point for your Oracle research is our analysis highlighting 2 key rewards and 3 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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