Could Oracle (NYSE: ORCL) Really Crack $1 Trillion?

Thanks to stunning demand for its AI infrastructure, Oracle could be on track for a $1 trillion valuation. For comparison, there are only six companies in the United States that currently have a valuation that high. But with a nearly 50-year history as a pioneer in the tech industry, and one of the world’s leading data centers for AI developers, Oracle is delivering incredible results that could soon push it into that exclusive club.

What sets the Oracle Cloud Infrastructure (OCI) apart is its random direct memory access (RDMA) technology that allows for much faster AI model training. Its infrastructure is also automated. This allows the company to scale without needing time to hire and train new employees.

Other Big News from Oracle's Earnings Report

Oracle’s latest earnings report is packed with good news. While the company overall grew just 3% YOY, its OCI segment is up by 42%. Its order backlog is up by 44%, including 30 new customer deals representing $12.5 billion. Oracle is expanding fast to meet its demand, with an estimated 39% of its backlog projected to clear over the next year. There are a lot of additional deals in the works as well, proving that Oracle is showing no signs of slowing down.

What the Industry Is Saying

Many analysts are bullish on Oracle. It’s currently trading at a price-to-earnings (P/E) ratio of 25, significantly lower than many of its tech competitors. The company’s earnings-per-share would need to grow by a little over 11% each year to hit the trillion dollar mark by 2030. Its growth is currently a bit lower than that, though it is on track to reach that milestone by 2025. Even if Oracle doesn’t quite make it to $1 trillion by 2030, though, experts believe that it will get there eventually. If you want to invest in a company that’s likely to join that rare club, now could be the right time to buy into Oracle.

Neither Lisa Fritscher nor Stocks.News have positions in Oracle.