The race for AI infrastructure has driven up costs, with Oracle raising its capital expenditure budget to $50 billion. Despite a 58% stock decline, Oracle plans a $300 billion deal with OpenAI, causing analysts to speculate on job cuts and asset sales. Oracle’s Q2 report showed strong revenue growth, with cloud services accounting for 50%.

While Oracle stock has fallen, its P/E ratio is low at 20.9 and it pays a dividend of $2 per year. The company sold Ampere Computing for a $2.7 billion gain to focus on chip neutrality for AI. Management sees opportunity in AI models and plans to embed AI in various software applications.

Analysts are bullish on ORCL stock, with a mean price target of $301 suggesting a 107% increase. Despite concerns, Oracle is undervalued, with strong growth potential in its cloud business. Investing in AI infrastructure may be a smart move, given the future payoffs expected from deals like OpenAI.

Read more at Yahoo Finance: 30,000 Layoffs Could Soon Hit at Oracle. What Does That Mean for ORCL Stock?