Why Oracle Rallied Today for the Second Day in a Row

Shares of tech giant Oracle (NYSE: ORCL) rallied another 7.8% on Friday, even as the broader Nasdaq Composite was down 1.3% on the day.

The notable and divergent outperformance came after a series of sell-side analyst upgrades in the aftermath of Wednesday's blowout earnings report.

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Analysts race to upgrade Oracle's price target

In Wednesday's fiscal fourth-quarter 2025 report, Oracle posted 11% revenue growth to $15.9 billion, while adjusted (non-GAAP) earnings per share (EPS) rose a more modest 4.3%. Still, both figures beat expectations, with revenue beating by a substantial $300 million, and adjusted EPS ahead of the expected $1.64.

Perhaps more impressive than the actual results was the company's forward guidance. CEO Safra Catz raised the company's fiscal 2026 guidance to $67 billion, which would amount to 16% growth -- a notable acceleration. The revenue will be fueled by the company's ongoing cloud infrastructure growth, which Catz projects will grow 70% this year, accelerating from 51% last year.

Oracle rocketed 13.6% yesterday, but then rallied another leg up today as more Wall Street analysts weighed in.

The biggest price target increase came from the analyst teams at Goldman Sachs, which raised its price target by $50 from $145 to $195, albeit while keeping a neutral rating on the stock. Additionally, BMO Capital Markets raised its price target from $200 to $235, while raising its rating from neutral to outperform.

While other analysts were also raising their targets after the results, those two gave the biggest price target increases today.

Image source: Getty Images.

Oracle is defying skeptics

Investors had worried about Oracle's ability to transition to the cloud era, as up-and-coming database challengers were coming after its core database business, while Oracle also got a very late fourth-place start in the cloud infrastructure-as-a-service competition. However, the acceleration in its cloud database and infrastructure offerings is silencing the critics, at least for now.

Artificial intelligence is boosting demand for cloud infrastructure everywhere, and it appears as though Oracle has been using the opportunity to capitalize.

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Billy Duberstein and/or his clients have no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Goldman Sachs Group and Oracle. The Motley Fool has a disclosure policy.