Palantir (NASDAQ:PLTR) stock hardly needed a push given the surge it has been on over the past year (up 508%) but it got one anyway earlier this week. The company’s Q4 earnings and outlook exceeded expectations and that was the signal for more gains with the shares soaring by 25% in the subsequent session.
Maximize Your Portfolio with Data Driven Insights:
- Leverage the power of TipRanks' Smart Score, a data-driven tool to help you uncover top performing stocks and make informed investment decisions.
- Monitor your stock picks and compare them to top Wall Street Analysts' recommendations with Your Smart Portfolio
Now there are quite a few market watchers that have been applauding the big data company’s positioning in the AI game, yet feel that an extremely frothy valuation remains a problem.
However, it’s safe to say Wedbush analyst Daniel Ives is not one of them. Ives is a long-time PLTR believer, and the latest set of results had the analyst donning the bull suit once more.
“There are some transformational tech stocks that come along every decade and change the landscape…Palantir is one of them in our view and proved it for all the tech world to see,” Ives proclaimed.
With its AIP product acting as an unmatched moat, Ives sees the company operating at the forefront of the AI revolution.
“Karp & Co. are playing chess in the AI Arms Race while others play checkers and the bears continue to miss this generational tech story as they cannot find AI in their spreadsheets,” Ives went on to say.
There were beats across the board with special mention given to the “all-important” US commercial revenue segment, which saw 54% year-over-year growth in FY24 compared to the company’s guide of 50%+ as PLTR “continues to see momentum within the US for its entire AI suite.”
Meanwhile, the total number of customers increased by 43% year-over-year and 13% sequentially, as the boot camp strategy continues to drive a strong pipeline of multi-year deals, including 129 worth at least $1 million and 32 exceeding $10 million. Palantir appears to be gaining traction among enterprises looking to harness AI for “optimized efficiencies” and operational improvements. At the same time, U.S. government revenue experienced reacceleration, rising by 42% y/y to $343 million, fueled by strong momentum at the DoD, where Ives thinks AI remains a “big focus.”
There was also a solid guide with FY25 revenue expected in the range between $3.741 billion and $3.757 billion, outpacing the Street’s $3.50 billion forecast. That is mostly down to the expectation US commercial revenue will climb by over 54% as “demand for PLTR solutions continues to accelerate.”
Bottom line, Ives rates PLTR shares as an Outperform (i.e., Buy), while raising his price target from $90 to $120, making room for additional gains of ~19% from current levels. (To watch Ives’ track record, click here)
Ives, however, is not surrounded by many PLTR bulls. While one other thinks the stock is a Buy, 11 recommend to Hold while 5 implore to Sell, all adding up to a Hold (i.e., Neutral) consensus rating. The forecast calls for a one-year decline of ~15%, considering the average price target stands at $86. (See PLTR stock forecast)
To find good ideas for stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a tool that unites all of TipRanks’ equity insights.
Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.
