Palantir Technologies (NASDAQ:PLTR) has been one of the hottest stocks on the market in recent months. Shares are up 320% since December 5 on the back of enthusiasm around artificial intelligence (AI). That makes Palantir the best performing member of the S&P500 (SNPINDEX: ^GSPC) this year.
The company is currently worth $165 billion, but Wedbush Securities’ Dan Ives thinks “Palantir could be next.” OracleThis statement might have caught the attention of more investors had Ives (for lack of a better word) chosen a more trendy comparison, but the implications are still huge for shareholders.
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Oracle is a $500 billion company (200% more than Palantir), with a strong presence in several enterprise software verticals, including analytics and business intelligence platforms. Ives doesn’t expect Palantir’s shares to rise 200% in the next 12 months, but instead thinks the company can grow to that valuation over the next three to four years.
What makes this call particularly surprising is that most experts are still skeptical about Palantir. Among the 20 analysts covering the company, the stock has an average price target of $38 per share. That implies a 47% downside from the current share price of $72.
Here’s what investors need to know about Palantir.
Palantir helps commercial and government organizations gain insight into complex data. The core products Gotham and Foundry enable customers to integrate intelligence and intelligence machine learning (ML) models to analytical applications. And his AI platform AIP adds support for large language models and generative AI to its core software products.
In August, Forrester research recognized the company as a leader in AI/ML platforms. The analysts wrote: “Palantir is quietly becoming one of the biggest players in this market.” And in September, Dresner Advisory Services listed Palantir as a top vendor in its 2024 market study on AI/ML and data science software.
That puts the company in a good position. The International Data Corp. (IDC) estimates that spending on AI platforms will increase 41% annually through 2028. Meanwhile, Grand View Research expects the data analytics software market to grow 27% annually through 2030.
Palantir has met all requirements with its third quarter financial report. The company exceeded expectations, raising full-year expectations and providing encouraging insight into the business. Total revenue rose 30% to $725 million, the fifth consecutive acceleration, and non-GAAP net income rose 43% to $0.10 per diluted share.
