Overview
Bernstein SocGen Group has reduced its price target for Oracle (NYSE:ORCL) to $313.00 from $339.00, but kept an Outperform rating on the shares. Oracle was trading at $155.28, having declined more than 10% over the prior week according to InvestingPro data.
The adjustment follows Oracle’s announcement of a sizable financing program - described by the company as a $45 billion to $50 billion package of debt and equity - intended to bankroll its AI data center build-out and satisfy contracts signed last year. Bernstein says it updated its models to incorporate the new debt and equity details and now expects the proceeds to fund Oracle’s commitments through fiscal year 2028, and potentially beyond.
Valuation assumptions and modelling changes
As part of the update, Bernstein lowered its price-to-forward-earnings multiple from 30x to 28x. The firm framed that reduction as a recalibration toward peer valuations in light of the controversy surrounding the data center expansion. Even with the lower target and multiple, Bernstein characterized the prevailing stock price as "a solid entry point" into what it called "one of the few revenue and EPS acceleration stories in software."
Third-party InvestingPro metrics cited alongside Bernstein’s note show a PEG ratio of 0.88 for Oracle, which the data service interprets as the shares trading at a relatively low P/E versus projected earnings growth. InvestingPro’s technical readings also flagged the stock as in oversold territory, while its Fair Value assessment suggested Oracle is roughly fairly valued under current criteria.
Related financing and market responses
Oracle has undertaken multiple funding actions in recent weeks. The company launched a $20 billion at-the-market common stock offering and executed a $25 billion debt issuance, enlisting multiple sales agents including BofA Securities and Goldman Sachs. Those moves followed an earlier $30 billion raised through debt financing. The cumulative activity has prompted a range of analyst reactions.
Citizens lowered its price target to $285 while maintaining a Market Outperform rating. BMO Capital trimmed its target to $205, pointing to the breadth of the capital-raising package - which includes debt, preferred equity and common equity - even as it noted strong demand for the debt tranche. Conversely, DA Davidson moved to upgrade the stock from Neutral to Buy, citing expectations tied to OpenAI’s competitive position in the AI market.
Regulatory and public scrutiny
Beyond investor reaction, Oracle has faced public scrutiny linked to its data center electricity plans. Michigan Attorney General Dana Nessel has publicly described Oracle and OpenAI as "untrustworthy" in the context of the proposed power arrangements, urging reconsideration of approval for DTE Energy to supply power to the development. That statement underscores regulatory and community-level uncertainty that accompanies large infrastructure projects.
Conclusion
Bernstein’s move compresses near-term valuation expectations while leaving its longer-term bullish thesis intact. The firm expects the recent financing to cover Oracle’s capital needs for several years, but market participants and state officials have signaled a mix of concern and confidence. The capital plan, the reception by fellow analysts, and continued regulatory attention will likely remain focal points for investors assessing Oracle’s path as it expands AI-related infrastructure.