Oracle shares rallied more than 9% on Monday following a significant analyst upgrade. D.A. Davidson raised its rating on the stock to buy from neutral. The firm argues the market over-penalized Oracle for its heavy AI data center spending and its relationship with OpenAI.
D.A. Davidson stated that Oracle’s core software business currently accounts for its entire valuation. The analyst suggests the rapidly growing Oracle Cloud Infrastructure business represents pure upside at current price levels.
Oracle plans to raise between $45 billion and $50 billion in 2026 to fund cloud expansion. This capital strategy previously generated investor concern and stock price volatility.