Palantir Technologies (PLTR) recently received a notable boost from Bank of America Securities, as analyst Mariana Perez Mora raised her price target for the stock from $30 to $50.
This new target represents a potential upside of 43.8% from current levels and was accompanied by a reiterated “Buy” rating. Mora’s optimism centers on Palantir’s upcoming inclusion in the S&P 500 index, a development she calls a “watershed moment” for the company.
Mora’s bullish outlook is driven by Palantir’s expanding presence in the artificial intelligence (AI) market and its strong customer base, which includes both government agencies and large commercial enterprises. The analyst highlights Palantir’s “Ontology” platform, which enables businesses to leverage large-scale data for enhanced decision-making through automation. She also sees promise in Palantir’s capability to integrate advanced technologies such as machine learning, AI, and quantum computing.
Additionally, Mora emphasizes Palantir’s unique sales model, where engineers work closely with clients to develop tailored solutions, fostering long-term relationships and enabling the company to charge premium prices. With an operating margin of 35%, Mora believes Palantir is well-positioned for continued success in its niche market.
While Palantir’s stock continues to rise—up over 100% year-to-date—some insiders have been selling shares. Notably, co-founder Peter Thiel has set up a pre-arranged plan to sell up to $1 billion worth of Palantir stock by 2025. Corporate insiders have also sold shares totaling $11.1 million in the last three months, according to recent data, reflecting a “Negative Insider Confidence Signal.”
Despite Mora’s enthusiasm, not all analysts share the same positive outlook. Palantir holds a “Hold” consensus rating on TipRanks, with four analysts giving it a “Buy” rating, five maintaining “Hold,” and six recommending “Sell.” The average price target stands at $27.08, suggesting a downside potential of 22.1%.
Though Palantir’s revenue grew 17% in 2023, and analysts expect 23-24% growth this year, some remain cautious about its valuation. Trading at over 70 times forward earnings, Palantir may be priced for perfection, leading some investors to seek AI-oriented stocks with more attractive valuations.
Yahoo Finance, TipRanks, and The Motley Fool contributed to this report.
