Freedom Broker analysts name Oracle stock one of July’s best investments

Freedom Broker experts consider Oracle (ORCL) shares one of the most attractive investment ideas for July. In their view, the market reacted too sharply to concerns about the company’s capital expenditures, while underlying demand for Oracle’s cloud and AI services continues to grow rapidly. The stock’s upside potential is estimated at nearly 30%.

About Oracle

Oracle is one of the world’s largest developers of enterprise software and databases. In recent years, the company has been actively expanding its cloud business, Oracle Cloud Infrastructure (OCI), which is becoming a key driver of growth amid the artificial intelligence boom.

Recommendation and upside potential

Freedom Broker recommends buying Oracle shares. Oracle’s target price is $158,21 per share, implying upside potential of about 30% versus the current level of $121,2.

Why Oracle is among the best investment ideas 

The main argument in favor of the idea remains the rapid expansion of Oracle’s cloud business. In Q4 of fiscal 2026, OCI revenue grew 93% year over year. Even more impressive is the trend in Remaining Performance Obligations (RPO), which reflects the volume of future revenue under signed contracts: it reached a record $638 bln, rising by $85 bln in just one quarter.

Analysts also cite the structure of large AI contracts as an additional factor of resilience. About $75 bln of agreements provide for customer prepayments or the use of customers’ own equipment, which reduces pressure on Oracle’s capital expenditures.

Capital rotation favors Oracle

Another argument in favor of Oracle shares, analysts say, is a possible shift in investor preferences within the technology sector. In their observations, capital is gradually rotating out of semiconductor manufacturers and into software developers.

This is indicated by the weaker performance of the semiconductor ETF SMH compared with the software ETF IGV. In such an environment, Oracle could become one of the main beneficiaries of investors’ interest in AI software solutions.

The company benefits amid AI investment

Oracle remains one of the key beneficiaries of the surge in investment in artificial intelligence infrastructure. One of the key indicators of future growth was the volume of remaining performance obligations (RPO), which increased to a record $638 bln versus $553 bln in the prior quarter. A significant share of the increase was driven by long-term contracts in the AI space. Oracle’s management reaffirmed its revenue forecast for fiscal 2027 at around $90 bln  and later raised its forecast for adjusted earnings per share to $8,05.

The company continues to actively expand its AI infrastructure. In July, Oracle announced the launch of a new tool, Oracle AI Agent Studio, for building enterprise AI agents within the Oracle Fusion Applications ecosystem. The solution enables customers to automate business processes using agentic AI directly within the company’s enterprise systems.

New partnerships 

Another growth driver has been major government and corporate contracts. In June, the U.S. Office of Personnel Management (OPM) signed a $395,8 mln contract with Oracle to create a single federal HR management platform based on Oracle Fusion Cloud HCM. The project will cover more than 2 mln federal employees and is intended to replace more than 100 fragmented HR systems.

At the same time, Oracle is accelerating the construction of data centers for AI workloads. In the spring, Reuters reported that Pacific Investment Management Company (PIMCO) is in talks to provide about $14 bln in financing for Oracle’s data center project in Michigan. According to Freedom Broker analysts, the potential deal would be an important confirmation of major institutional investors’ confidence in Oracle’s AI strategy and would allow the company to execute large-scale projects without significant dilution of shareholders’ equity.

This is not an individual investment recommendation.