Sustainable cloud growth should make Oracle shares look even more attractive, according to Stifel. The bank upgraded the tech company to buy from hold. Analyst Brad Reback lifted his price target to $250 per share from $180, which signals upside of about 19% from Friday’s close. Shares of Oracle have been on fire in 2025, gaining 26%. Reback believes that Oracle’s cloud acceleration appears sustainable, which would drive further gains. For each of the next two fiscal years, the analyst forecasts that Oracle’s total cloud revenue could grow in the high 30% range. ORCL YTD mountain ORCL YTD chart “Upgrade to Buy as the recent dramatic step-up in capex and RPO gains support management’s Cloud (Infrastucture + SaaS-Apps) growth expectations and these Cloud gains should generate accelerating total revenue increases in coming years ( ~16% FY26 , ~20% FY27),” he wrote. Reback also noted that Oracle has already seen an improvement from spending cuts and management’s focus on efficiency. Total revenue rose 8% last year, while headcount and total operating expenses only grew 2% and 5%, respectively. “While the higher capital spending will lead to additional near-term gross-margin compression, there is no question this management team is extremely adept at managing expenses,” Reback said. “This, coupled with a greater emphasis on physical infrastructure rather than people to generate new business, should enable revenue to grow meaningfully faster than opex in coming years.” In the coming years, Oracle is likely to become even less dependent on increasing headcount to drive growth. This mix of spending discipline and sustainable cloud growth should enable Oracle to post accelerating earnings growth starting in 2027, Reback added. Shares rose 2% after the upgrade.
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