"Opportunities emerge after a historic plunge"! Citigroup bets that Oracle Corporation (ORCL.US) will double its stock price and includes it in a 90-day catalyst watch.

Recently, Citigroup placed the IT giant on a 90-day positive catalyst watch list. The firm maintained a "buy" rating with a target price of $330. As of the time of publication, Oracle Corporation (ORCL.US) rose 1.2% in after-hours trading, priced at $150.64. We are initiating a positive catalyst watch and reevaluating the bullish thesis for Oracle Corporation's cloud business, wrote Citigroup analyst Tyler Radke in a report to clients. We believe that after experiencing the most extreme valuation misalignment and pullback in the stock's history, opportunities have emergedthis recent decline stemmed from panic selling by investors and several technical selling factors (widening credit spreads, ATM share issuance). We judge that the persistently strong trend in AI demand, along with the margin/price pass-through effects from 'new cloud vendors,' will lay the groundwork for upward revisions in earnings forecasts, thereby driving the stock price stronger ahead of the earnings release and investor day in late October. Over the past three months, Oracle Corporation's stock price has dropped approximately 25%, significantly underperforming large tech peers (which rose about 10% during the same period); the decline over the past 12 months is closer to 40%. Despite the pressure on its stock price, Oracle Corporation's business fundamentals remain strong. The cloud infrastructure business has seen explosive growth. In the fourth quarter of fiscal year 2026, Oracle Corporations cloud infrastructure (IaaS) revenue increased 93% year-over-year to $5.8 billion. AI infrastructure revenue surged by 243% year-over-year, while multi-cloud database revenue rose by 531%. Backlogs have reached a record high. Remaining performance obligations (RPO) soared to $638 billion, with a quarter-over-quarter increase of $85 billion. The company signed $67 billion worth of AI infrastructure contracts during the quarter. Customers have made approximately $75 billion in advance payments for AI-related hardware, partially alleviating Oracle Corporation's burden for infrastructure development. The AI strategy is pervasive across the stack. Oracle Corporation CEO Mike Sicilia stated at the Deutsche Bank Aktiengesellschaft technology conference that the company is deeply integrating AI into its Fusion application suite and expects about half of its existing on-premises customers (especially in regulated industries) to migrate to the cloud.