Oracle (ORCL) stock declined more than 10% on Friday following a BNP Paribas research note projecting the company will increase capital expenditures to between $80 billion and $100 billion for data center campuses and Nvidia chip acquisitions. Analyst Stefan Slowinski issued the projection in connection with Oracle's Project Stargate infrastructure initiative. The stock movement occurred amid a broader market sell-off, with Oracle ranking among top-trending tickers on Stocktwits as companies across the technology sector accelerate infrastructure buildouts to meet artificial intelligence computing demands.
BNP Paribas Projects $80-100 Billion Oracle Capex for Project Stargate
According to Seeking Alpha, analyst Stefan Slowinski stated in a research note that Oracle is expected to spend between $80 billion and $100 billion to bring online data center campuses under Project Stargate and to acquire Nvidia (NVDA) chips to power them. The analyst set a price target of $283 on the stock, implying an upside potential of nearly 20% from the stock's closing price on Thursday.
Analyst Ratings Show 36 of 43 Recommend Buy or Higher
As per Koyfin data, 36 out of 43 analysts covering the stock rate ORCL a 'Buy' or higher, six rate it a 'Hold,' and one rates it a 'Sell.' For the fourth quarter, analysts expect revenue of $19.1 billion and adjusted earnings per share of $1.96.
Tech Companies Spend Hundreds of Billions on AI Infrastructure
The demand for artificial intelligence has led to an aggressive infrastructure buildout by companies and hyperscalers to generate the computing power needed to keep the technology running. Tech companies Meta (META), Amazon (AMZN), Google (GOOG, GOOGL), and Microsoft (MSFT) are spending hundreds of billions of dollars in the U.S. on their infrastructure projects, triggering a wave of chip and other component shortages while simultaneously contributing to record-high energy consumption.
Retail Traders Maintain Extremely Bullish Sentiment on ORCL
On Stocktwits, retail sentiment about the ORCL stock remained in 'extremely bullish' territory amid 'high' message volume over the last 24 hours, with many users seeing the pullback as a buying opportunity. ORCL stock has gained more than 10% so far this year and has risen nearly 26% over the last 12 months, outperforming the S&P 500.
FAQ
What did BNP Paribas say about Oracle's capital spending plans?
BNP Paribas analyst Stefan Slowinski stated in a research note that Oracle is expected to spend between $80 billion and $100 billion to bring online data center campuses under Project Stargate and to acquire Nvidia chips to power them. The analyst set a price target of $283 on the stock.
How many analysts rate Oracle stock as a Buy?
According to Koyfin data, 36 out of 43 analysts covering Oracle rate the stock a 'Buy' or higher, six rate it a 'Hold,' and one rates it a 'Sell.' For the fourth quarter, analysts expect revenue of $19.1 billion and adjusted earnings per share of $1.96.
Why are technology companies increasing infrastructure spending?
The demand for artificial intelligence has led companies and hyperscalers to build aggressive infrastructure to generate the computing power needed to keep the technology running. Tech companies Meta, Amazon, Google, and Microsoft are spending hundreds of billions of dollars in the U.S. on their infrastructure projects.
