The article argues that Oracle, with its fast-growing cloud business, may be a more compelling cloud choice than Alphabet or Microsoft for an investor with $5,000. Its cloud infrastructure revenue rose 121% to $7.4 billion in the latest quarter, and its remaining performance obligations (RPO) hit a record $664 billion, up $209 billion year over year. Its edge comes from pairing its established database business with enterprise cloud infrastructure and offering its database services on AWS, Microsoft Azure and Google Cloud. According to the article, 42 analysts give Oracle a strong buy consensus, with target prices implying 87% (average) to 206% (highest) upside over the next 12 months, and the stock trades at about 20 times earnings. However, Oracle is spending heavily on data centers, which is weighing on free cash flow and means its spending exceeds what its operations generate.
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