Oracle Corp (NASDAQ:ORCL) shares are trading higher on Wednesday. Deutsche Bank said the tech giant’s current share price implies minimal credit for its business with OpenAI.
- ORCL stock is racing ahead of the pack. Get the complete analysis here.
What To Know: Deutsche Bank analyst Brad Zelnick reiterated his Buy rating on Oracle with a $375 price target on Wednesday. According to multiple reports, the analyst noted that if OpenAI‑related revenue and expenses are excluded, Oracle's projected earnings per share for fiscal 2030 would fall by $4 to about $17.
“Discounting these numbers back to present would suggest the company is getting little if any credit for its business with OpenAI at the current share price,” Zelnick reportedly said in a note to clients.
The firm also addressed concerns about Oracle's long‑term lease commitments, noting there is "a good deal of flexibility" built into those agreements. Even if Oracle had to absorb about half of the estimated lease costs tied to lost OpenAI business, Deutsche Bank estimates the company would still generate roughly $15 in earnings per share and $26 billion in free cash flow.
ORCL Analyst Ratings
Oracle has witnessed a mix of rating updates from various analysts in recent weeks. Prior to the rating given by Deutsche Bank, DA Davidson maintained its neutral stance on Oracle with a reduced target of $200 from the previous $300.
Earlier this month, Baird maintained its outperform rating, but lowered its target price to $315 from the previous $365. A month prior, Jefferies kept its buy rating unchanged, but raised its target from $360 to $400. On the same day, Scotiabank also maintained its sector outperform rating on Oracle and increased its target price to $360 from $350.
ORCL Price Action: Oracle shares were up 4.27% at $205.40 at the time of publication on Wednesday, according to Benzinga Pro.
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