Wells Fargo believes that Oracle has more AI-fueled gains ahead. In a Wednesday note, the bank initiated the stock at an overweight rating and set a price target of $280, which implies 39% upside. Shares of Oracle are up 21% this year, but they’ve fallen nearly 29% in the fourth quarter as investors worry the company can sustain its sky high valuations. However, analyst Michael Turrin believes that it is still early days for Oracle, with the artificial intelligence boom presenting room for the stock to run. ORCL YTD mountain ORCL YTD chart “We see ORCL emerging as a leader in the AI super-cycle: nearly half a trillion in AI deals already booked & pole position w/ key accts (OpenAI, xAI, Meta, TikTok). Plus, shares now sit 42% off highs, ~25x P/E on FY27E,” he said in a note. Turrin sees Oracle emerging as a clear market share gainer in the infrastructure cloud market, with the company set to reach similar scale to the next closest hyperscaler by 2029. He sees the company set to eventually become the fourth major cloud. The analyst estimated that Oracle Cloud Infrastructure will reach around 16% of the cloud market by 2029. In contrast, it had just 5% of the market share in 2025. “ORCL’s climb to match the scale of the third largest hyperscaler will be primarily driven by its AI business, where it continues to drive additional investment and focus. We note specifically that ORCL now has the largest backlog base of any cloud provider at $455B (pro forma $500B+), vs MSFT last reported $392B,” he wrote. Turrin not only expects upside to the existing $75 billion in commitments from various AI labs such as Meta and xAI, but also sees upside to Oracle’s $300 billion computing contract deal. Oracle shares rose nearly 2% on Wells Fargo’s call.
