Prediction: Oracle Stock Trails the S&P 500 Through 2030

Oracle stock appears cheap at 16x forward earnings, but the analyst predicts it will underperform the S&P 500 through 2030. The company is spending heavily on AI infrastructure ($70-95 billion planned for fiscal 2027) while generating negative free cash flow for six consecutive quarters. With half of its $664 billion contract backlog not expected to convert to revenue until after August 2029, Oracle must fund the gap through debt and equity dilution, which will pressure shareholders until the data centers ramp up.