The firm cited Oracle’s bookings of nearly $500 billion in AI deals as one of the reasons behind its optimism.
Oracle Corp.’s (ORCL) artificial intelligence efforts on Wednesday received a thumbs-up from the analysts at Wells Fargo.
According to TheFly, Wells Fargo initiated coverage of Oracle with an ‘Overweight’ rating and a price target of $280, implying an upside of more than 39% from ORCL stock’s closing price of $201.1 on Tuesday.
Oracle’s shares were up nearly 2% in Wednesday’s pre-market trade. Retail sentiment on Stocktwits around the company trended in the ‘bearish’ territory at the time of writing.
Wells Fargo’s Bull Thesis
Explaining its bullish outlook for Oracle, Wells Fargo stated in its note that it expects the company to emerge as the leader in the artificial intelligence “super-cycle.”
The firm cited Oracle’s bookings of nearly $500 billion in AI deals as one of the reasons behind its optimism. It added that Oracle is in the “pole position” with companies like OpenAI, xAI, Meta Platforms Inc. (META), and TikTok.
According to a report by The Wall Street Journal, OpenAI has struck a $300 billion deal with Oracle, committing to purchase computing capacity over the next five years to power its AI initiatives, including ChatGPT.
However, since the OpenAI deal was reported on September 10, Oracle’s shares are down nearly 39%.
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