Palantir Technologies (NYSE:PLTR) is among the early beneficiaries of the accelerated adoption of artificial intelligence (AI) – and for good reason. The company’s AI solutions are gaining traction among enterprise and government customers, driving strong revenue and profit growth. Another telling sign is that Palantir recently joined the S&P500sending shares up 25% in the roughly two weeks since the announcement was made.
One Wall Street analyst believes this is just the beginning.
Next stop: $100?
In an interview on Fox News, Greentech Research analyst Hilary Kramer said that among AI stocks, “Palantir is my absolute 100% favorite,” noting that the company is a “real artificial intelligence company,” which analyzes data to help companies providing “actionable decision-making”.
The analyst further notes that many of her colleagues continue to underestimate Palantir. Given the company’s strong sales, earnings growth, and growing backlog, investment banks will eventually have to come on board and raise their estimates, believing Palantir could “easily” be a $100 stock.
I think the analyst hit the nail on the head. In the second quarter, Palantir’s revenue of $678 million rose 27% year over year, delivering adjusted earnings per share that rose 80% to $0.09.
The headliner was the company’s U.S. commercial segment, which saw revenues of $159 million increase 55% and now account for 23% of Palantir’s total revenue. The number of customers in the segment increased by 83%, while the value of remaining deals – or contracts not yet counted as revenue – increased by 103%.
Palantir’s Artificial Intelligence Platform (AIP), are generative AI solution, is the driving force behind this robust growth. The company perseveres AIP boot campspairing corporate and government clients with Palantir engineers to create solutions to real-world problems. This has contributed to the company’s recent growth spurt.
In addition, management raised its full-year outlook for the second time. Palantir now expects annual revenue of $2.75 billion, an increase of 23%.
Palantir stock has a price-to-earnings-growth ratio (PEG) of 0.36, while any figure lower than 1 is the norm for an undervalued stock.
Therefore, Palantir shares remain a buy.
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Danny Vena has positions in Palantir Technologies. The Motley Fool holds positions in and recommends Palantir Technologies. The Motley Fool has one disclosure policy.
Will Palantir Technologies stock go to $100 now that it’s included in the S&P 500? 1 Wall Street analyst thinks so. was originally published by The Motley Fool