Oracle (NASDAQ:ORCL) has made a bold move that is generating mixed reactions among investors. The tech giant recently announced a $20 billion equity distribution agreement, allowing it to sell shares into the market over time. The announcement comes as Oracle ramps up spending to expand its cloud infrastructure business while managing concerns over leverage, execution risk, and shareholder dilution. This move raises an important question for investors: does this make ORCL stock news worth paying attention to—and could it be the right time to buy shares?
About Oracle and Its Stock
Oracle Corporation is a global leader in cloud infrastructure, software, and hardware, known primarily for its flagship Oracle Database, the first commercially available SQL-based relational database management system. The company also provides Infrastructure-as-a-Service (IaaS) and Platform-as-a-Service (PaaS) solutions, including the world’s first autonomous database.
Oracle’s AI-powered enterprise applications cover Enterprise Resource Planning (ERP), Human Capital Management (HCM), Customer Relationship Management (CRM), and Supply Chain Management (SCM). The company’s market cap sits at $463.1 billion, though its stock has slumped 28% this year amid analyst downgrades, legal pressures, and a challenging macro backdrop for AI infrastructure spending.
Oracle’s $20 Billion Equity Sale
On February 2, Oracle entered an equity distribution agreement to sell up to $20 billion of its common stock through an at-the-market offering. This method allows the company to sell shares over time at prevailing market prices rather than in a single bulk sale.
While ORCL stock dropped 2.8% on the first day of sales, subsequent declines were largely driven by tech sector rotation. In parallel, Oracle also raised about $5 billion through mandatory convertible preferred bonds—a hybrid instrument paying dividends that will convert to common stock at a set date.
The $20 billion equity raise is part of Oracle’s broader Equity and Debt Financing Plan for 2026, targeting $45–50 billion to fund the rapid expansion of its Oracle Cloud Infrastructure (OCI) business. Roughly half of this amount is expected to come from debt, which has already been partially secured via a record $25 billion bond offering.
Strong Demand for Debt and AI Growth
Oracle attracted unprecedented demand for its bonds, with investors submitting orders totaling $129 billion, surpassing the previous record set by Meta Platforms (NASDAQ:META). This indicates strong confidence in Oracle’s ability to manage its balance sheet despite substantial AI-related investments.
Before the bond offering, Oracle held around $100 billion in long-term debt. Concerns over AI investment risks had pushed some bonds to trade like junk, but after the offering, credit risk measures improved dramatically. Analysts, including Mizuho’s Siti Panigrahi, say the equity sale should alleviate debt pressures while supporting continued expansion in cloud infrastructure.
Shareholder Dilution Concerns
The major drawback of equity issuance is shareholder dilution. Analysts estimate the program could add over 100 million new shares to the market. Management, however, is confident that the $523 billion cloud backlog justifies short-term dilution in exchange for long-term revenue growth.
Oracle’s client list includes high-profile partners such as Nvidia (NASDAQ:NVDA), Meta Platforms (NASDAQ:META), OpenAI, xAI, and Advanced Micro Devices (NASDAQ:AMD), further supporting its growth prospects.
Should You Buy ORCL Shares Now?
Despite easing some concerns around debt, Oracle faces execution risks, including converting its massive cloud backlog into revenue and reliance on a small number of key clients.
If ORCL stock stabilizes near $150 and shows bullish momentum, investors might consider opening small positions. Further declines could create a buying opportunity in the $100–$130 range.
Wall Street remains largely optimistic, reflected in a consensus “Moderate Buy” rating. Out of 41 analysts, 29 assign a “Strong Buy,” one a “Moderate Buy,” 10 recommend holding, and one a “Strong Sell.” The average price target of $300.94 suggests ORCL shares could more than double from current levels.
Conclusion
Oracle’s $20 billion equity sale is a strategic move to fund AI cloud infrastructure expansion while balancing debt and shareholder dilution. For investors following ORCL stock news, the decision highlights both opportunities and risks: the potential for significant long-term growth against the short-term impact of dilution and execution challenges.
For those watching AI infrastructure stocks, Oracle remains a key player, and careful monitoring of its execution and cloud adoption will be crucial in assessing whether ORCL shares are an attractive investment today.
Featured Image: Unsplash
Author Stephanie Bédard-Châteauneuf 
