Oracle stock price continued its strong surge this year and is now hovering near its all-time high. It was trading at $242 on Thursday, up by 106% from its lowest point in April, giving it a market capitalization of over $682 billion.
Why Oracle stock price has surged
Oracle is a giant technology company offering tens of services to some of the largest companies globally. Unlike Microsoft, Oracle’s business is not a well-known brand because it does not offer consumer services.
Oracle’s database services run the world as they are used by some of the biggest companies globally, like Microsoft, JPMorgan, Intel, Netflix, and AT&T.
The company has expanded its solutions over the years. For example, t has become one of the biggest ERP providers globally. It also offers various services like cloud computing and servers.
Therefore, the Oracle stock price has surged due to its presence in the AI industry, where its cloud infrastructure is experiencing robust demand from A companies.
The most recent results showed that Oracle’s revenue jumped by 11% in the last quarter. Notably, its cloud infrastructure business is thriving, with its revenue jumping by 52% to $3 billion.
The other segments are also thriving, with Software as a Service (SaaS) generating over $3.7 billion, a 12% increase from the previous year. Altogether, its annual revenue rose by 8% to $57 billion.
Analysts are optimistic that Oracle’s growth will continue. The average estimate among analysts is that the annual revenue in the new financial year will be $66.75 billion, up by 16% from a year earlier.
Analysts also expect the first-quarter revenue to go up by 13% to $15 billion. The company is expected to be more profitable, with the average earnings per share expected to be $1.48, up from $1.39 last year.
Oracle stock price has also jumped because of the close relationship between Larry Ellison and Donald Trump. One way it may benefit is that it may be the winning bidder for TikTok.
Oracle share price analysis
The daily chart shows that the ORCL stock price has been in a strong bull run in the past few months. It recently moved above the key resistance level at $196.8, the highest swing in December last year. This price was also the upper side of the cup-and-handle pattern whose depth was 40%.
Therefore, measuring the same distance from the cup’s upper side gives a target of $275, which is 14% above the current level.
The risk, however, is that the stock may crash and retest the support at $196, and then resume the uptrend. This pattern is known as a break-and-retest pattern, one of the most bullish signs in technical analysis.
ORCL stock chart | Source: TradingView
Read more: Oracle stock price has surged, but beware of key risks
Will Larry Ellison flip Elon Musk in net worth?
The ongoing Oracle stock price surge has made its founder, Larry Ellison, very wealthy. His net worth has jumped by $102 billion to $293 billion, making him the second-richest person on earth.
His wealth has moved in the opposite with that of Elon Musk, who has lost $78 billion this year. There is a risk that the Tesla stock will plunge futher after its weak earnings this week. Tesla also lacks a catalyst as its sales plunge in all key countries.
Therefore, a further Tesla crash will hurt Elon Musk’s net worth. If Oracle’s stock jumps to our target, it means that Ellison’s wealth will be about $335 billion, potentially higher than Elon Musk’s.
In the long term, however, Elon Musk will likely maintain his title as the richest person on earth because of the diversity of his wealth. This surge will likely happen when he takes SpaceX and xAI public.
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