Oracle Corporation (ORCL) shares plummeted 5% in Thursday's trading session, following a target price cut by Melius Research. The firm reduced its price target for Oracle from $188 to $180, signaling potential concerns about the company's near-term prospects.
The downward revision comes amid mixed sentiments about Oracle's growth trajectory. While some investors remain optimistic about the company's cloud infrastructure and software-as-a-service (SaaS) segments, others are cautious about the pace of revenue acceleration. Oracle recently surprised investors by announcing an ambitious 2029 revenue target of $104 billion, implying an acceleration in annual revenue growth to approximately 16% from current levels of 9%-10%.
Despite the day's sharp decline, Oracle's stock has shown resilience over the past year, with shares gaining 17.45% over the last 52 weeks. Investors will be closely watching Oracle's performance in its cloud and SaaS businesses, as well as its ability to transition its on-premise database customers to higher-margin cloud solutions, to gauge whether the company can meet its lofty growth targets and justify its current valuation.
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.