Judgment: HOLD Oracle’s backlog and cloud mix are compelling, but the stock’s valuation (P/E ~50; EV/EBITDA ~51) already discounts much of that visibility. RPO surged to $455.3B and cloud services reached 43% of FY2025 revenue, supporting multi‑year growth, yet near‑term expense intensity for new data centers has pressured cash generation (FY2025 FCF negative) and leverage is not light (Net Debt/EBITDA 3.9x; interest coverage 4.9x). Execution risks remain around AI capacity build‑out and hyperscaler competition. Risk/reward looks balanced pending proof of margin and FCF inflection. WATCH ITEMS: • RPO trajectory and conversion: Sustained RPO growth with faster recognition into cloud services revenue would support an upgrade to BUY; a slowdown or slippage in cadence would bias to SELL. • FCF and margin inflection vs. capex: If new capacity drives sustained positive FCF and operating margin improvement as FY2026 progresses, upgrade to BUY; persistent negative FCF/cost overruns would trigger SELL. • AI capacity and multicloud adoption: Clear evidence of secured accelerator supply/utilization on OCI and strong uptake of Database@Azure/Google/AWS would improve confidence (toward BUY); supply constraints or weak adoption would tilt to SELL.