Oracle Stock Surges 43% YTD

Oracle stock (NYSE:ORCL) has surged 43% YTD, outpacing the S&P 500. The rise is driven by increased demand for Oracle’s cloud services amid the AI boom. Key factors include a 127% increase in the P/S ratio, 35% revenue growth, and a 3% rise in total shares outstanding.

Oracle’s revenue has grown 35% from $42 billion to $57 billion, led by Cloud Infrastructure (OCI) demand. OCI’s revenue hit $44 billion in FY25, up from $30 billion in 2022. Total cloud services revenue reached $24.5 billion, more than doubling from $10.8 billion in 2022.

Oracle’s stock valuation has surged, with the P/S ratio jumping 127% to 11.8x. Factors driving this include OCI market leadership, AI infrastructure premium, transformation to a high-growth cloud model, and potential margin expansion. Despite the positive outlook, ORCL stock at $235 seems richly valued.

Amid strong prospects, risks for Oracle include past stock price declines during downturns and significant capital expenditures exceeding $21 billion in FY25. The High Quality Portfolio offers a less volatile alternative for growth seekers, outperforming the S&P 500 with returns exceeding 91% since inception.

Read more at Nasdaq: What’s Behind The 3x Rise In Oracle Stock?