Oracle's stock could surge 80%, says this analyst who predicts a major rebound

By Emily Bary

Oracle's stock has come well off its highs, but a Jefferies analyst says concentration and debt concerns are overblown

Oracle's stock has fallen more than 30% from its peak.

Oracle Corp.'s stock can reclaim its highs and then post even bigger gains from there, according to a Jefferies analyst.

Jefferies' Brent Thill is sticking with his $400 price target on Oracle shares (ORCL), even as they've been dragged well out of record territory on concerns about the company's debt load and its heavy reliance on OpenAI to drive growth. The stock is down more than 30% from a closing high of $328.33 achieved in October, but Thill's target implies nearly 80% upside from Friday's close of $222.85.

With that upside potential, Thill sees an attractive risk-reward balance for shares at current prices and views the selloff as overblown. He noted that Oracle has erased $307 billion in market capitalization since its peak, more than the value of its $300 billion OpenAI contract - a trend that, in his view, "reduces the embedded OpenAI risk in the stock."

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Investors, he said, seem worried that Oracle faces the steepest concentration risk among hyperscale cloud providers. OpenAI is responsible for 58% of the company's backlog, he noted, versus 39% or more for Microsoft Corp. (MSFT) and 16% for Amazon.com Inc. (AMZN).

But if you back out the future OpenAI business, Oracle still has $220 billion in remaining performance obligations, a measure of contracted revenue that hasn't yet been recognized. That represents a 60% sequential boost on the metric.

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Thill noted that debt concerns have also pressured Oracle's stock, but said the company's "modular capex model," through which Oracle "avoids actual ownership of AI data centers and focuses instead on the installation of equipment and software inside," limits the need for the company to make major outlays of cash upfront.

And while investors have fretted about the margin profile of Oracle's work with OpenAI, Thill said the company can rely on its more profitable applications and database businesses to support its increased capital expenditures. Oracle could even take on more debt, he noted, as its ratio of net debt to earnings before interest, taxes, depreciation and amortization is 2.5x, below the company's peak level of 3.0x that was reached in fiscal 2023.

Thill has a buy rating on Oracle shares.

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-Emily Bary

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11-17-25 0936ET