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Oracle (ORCL) is back in focus after recent trading, with the stock last closing at US$203.70. Investors are weighing that price against the company’s size, at about US$549.2b in market value.
See our latest analysis for Oracle.
That latest move comes after a strong run, with a 22.7% 1 month share price return and a 40.1% 3 month share price return, while the 5 year total shareholder return of 168.8% points to sustained compounding.
If Oracle’s momentum has you rethinking your tech exposure, it could be a good moment to see what else is moving in AI infrastructure via our 46 AI infrastructure stocks
With Oracle growing revenue and net income at about 28% and 25% annually and trading at US$203.70, plus an indicated intrinsic discount of roughly 33%, is there still an opportunity here, or is the market already pricing in future growth?
Most Popular Narrative: 47.7% Undervalued
Oracle’s narrative fair value of $389.81 sits well above the last close at $203.70, putting a spotlight on how aggressively long term cash flows are being valued.
The story of Oracle’s transformation is a narrative of strategic repositioning that has culminated in the company emerging as an indispensable infrastructure partner for the world’s most demanding Artificial Intelligence (AI) workloads. This strategic shift, defined by massive infrastructure investment, a landmark partnership with OpenAI, and the rise of colossal superclusters, has driven an unprecedented surge in its contract backlog, fundamentally reshaping Oracle’s long-term growth trajectory and competitive landscape.
Curious what justifies that kind of gap between fair value and price? The narrative leans heavily on rapid AI infrastructure build out, rising contracted revenues, and ambitious profit targets, all stitched together into one aggressive growth path that the market is still debating.
Result: Fair Value of $389.81 (UNDERVALUED)
Have a read of the narrative in full and understand what’s behind the forecasts.
However, that story hinges on flawless execution of huge data center build outs, and on AI customers actually following through on large, long term contracts.
Find out about the key risks to this Oracle narrative.
Another View: What The P/E Ratio Is Saying
While the narrative model points to a fair value of $389.81 and an undervalued stock, the simple P/E check tells a different story. Oracle trades at 36.2x earnings, above the US Software industry average of 28.5x, yet below a peer average of 75.2x and a fair ratio of 61.4x that the market could move toward. Is the stock priced for perfection or just catching up to its own earnings power?
See what the numbers say about this price — find out in our valuation breakdown.
NYSE:ORCL P/E Ratio as at May 2026 Next Steps
Does this mix of optimism and concern match your own view, or feel out of step with it? Take a closer look at the underlying data, weigh both sides of the story, and then test your thesis against the 3 key rewards and 2 important warning signs
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If Oracle has sharpened your thinking, do not stop here. Broaden your watchlist with fresh ideas that could add balance and resilience to your portfolio.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Companies discussed in this article include ORCL.
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