--- title: "Amazon or Oracle: One AI Stock Worth Buying, the Other Is Too Risky, Says Investor" type: "News" locale: "en" url: "https://longbridge.com/en/news/296050856.md" description: "Investor Vladimir Dimitrov rates Amazon (AMZN) as a Buy and Oracle (ORCL) as Hold, citing diverging financial risks in the AI cloud race. While both companies are aggressively expanding infrastructure, Amazon's strong AWS growth and operating performance justify its capital spending. Conversely, Oracle faces significant risks due to negative free cash flow and heavy reliance on external financing for expansion, making it vulnerable to market corrections despite high analyst price targets." datetime: "2026-08-17T03:13:27.000Z" locales: - [zh-CN](https://longbridge.com/zh-CN/news/296050856.md) - [en](https://longbridge.com/en/news/296050856.md) - [zh-HK](https://longbridge.com/zh-HK/news/296050856.md) --- # Amazon or Oracle: One AI Stock Worth Buying, the Other Is Too Risky, Says Investor **Amazon (NASDAQ:AMZN)** and **Oracle (NASDAQ:ORCL)** have spent much of 2026 pursuing the same prize by capturing soaring demand for AI computing through larger cloud operations. Yet, their stocks have traveled in opposite directions, with Amazon gaining about 14% this year while Oracle has lost around 22%. The spending race may look similar from the outside, but the financial stakes behind each bet are anything but equal. ### Summer Sale - Claim 70% Off TipRanks High conviction AMZN bears now have this Tradr ETF Amazon's latest results gave investors several reasons to remain upbeat about those investments. AWS revenue climbed 37% year-over-year to $42.2 billion during the second quarter, marking its fastest growth rate in more than four years, while contract backlog reached $496 billion. Amazon has responded by lifting expected 2026 capital spending to about $220 billion, betting that demand for cloud computing and AI will justify the expense. Oracle is pursuing a similar opportunity, though its financial position makes that strategy harder to execute. Its latest quarterly cloud revenue rose 47%, including a 93% increase at Oracle Cloud Infrastructure, while remaining performance obligations reached $638 billion. However, Oracle reported negative free cash flow of $23.7 billion for fiscal 2026 and expects to raise about $40 billion through debt and equity during fiscal 2027. Investor Vladimir Dimitrov recently examined both stocks, looking at whether their aggressive infrastructure spending leaves enough potential reward to justify the risks involved. When it comes to Amazon, Dimitrov believes its operating performance deserves greater weight than fears surrounding the eventual payoff from its investments. "That is why I remain optimistic on AMZN as long as we see the business firing on all cylinders," Dimitrov says. AWS provides Dimitrov with an important reason for maintaining that view, given its continued expansion. Customer demand remains strong as AI adoption requires greater computing capacity throughout corporate operations. "It appears highly likely that investors' sentiment could quickly become overdone as the business continues to perform – especially in the AWS segment," the investor argues. Still, Dimitrov recognizes meaningful risks surrounding Amazon over shorter periods, particularly weaker consumer confidence and elevated exposure to broader stock-market movements. Those concerns temper his enthusiasm and leave some room for volatility if market conditions become less supportive. "I remain cautiously optimistic on the stock," Dimitrov concludes, assigning AMZN a Buy rating. Oracle presents Dimitrov with a different calculation following its fall during 2026. "The drop in Oracle's stock over the past year does not mean that investors are buying it at a discount," Dimitrov warns. His concern revolves around the financial burden required to compete for cloud infrastructure demand. Oracle has committed huge sums toward expansion while relying heavily on external financing, leaving less flexibility if returns from those investments fail to meet expectations. "ORCL seems to stand out as one of the most aggressive players," Dimitrov says, describing its approach toward the race for computing capacity. Another vulnerability could surface if cloud demand weakens or broader equity valuations retreat from elevated levels. Oracle's combination of leverage, aggressive expansion, and greater market sensitivity could amplify losses during an unfavorable environment. "If something goes wrong for the cloud sector as a whole or the equity market faces a more pronounced correction, then ORCL stock could be severely impacted," Dimitrov cautions. Accordingly, Dimitrov assigns ORCL shares a Hold (i.e., Neutral) rating. (To watch Dimitrov's track record, click here) Wall Street, however, does not see much reason to choose between the two. Both Amazon and Oracle earn Strong Buy consensus ratings, although analysts currently see much greater room for ORCL to recover. Amazon's average price target of $332.95 implies about 27% upside, while Oracle's $258.14 target points to 71.5% gains. 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