Big data analytics venture Palantir (NYSE: PLTR) has been one of the most closely-watched stocks over the past couple of years. Keen-eyed investors noted the company’s competitive edge early on, but consistent doubts remained as to whether the business could broaden its client base and successfully capture both commercial and public customers.
On November 4, the company released its Q3 2024 earnings call — posting strong results across the board.
Perhaps a tad immodestly, but accurately, CEO Alex Karp stated: ‘“We absolutely eviscerated this quarter, driven by unrelenting AI demand that won’t slow down. This is a U.S.-driven AI revolution that has taken full hold. The world will be divided between AI haves and have-nots. At Palantir, we plan to power the winners.”
Picks for you
In the short term, markets seem to agree with the sentiment. Before the earnings report was published, PTLR stock was trading at $41.45. At the time of publication, they have rallied by 23.35%, up to a new all-time (ATH) of $51.13, bringing returns on a year-to-date (YTD) basis up to 208.38%. The stock has climbed an additional 4.52% in the premarket trading session.
Analysts set mixed price targets for Palantir stock
Although the data intelligence company’s results were impressive in the third quarter, Wall Street remains divided when it comes to price targets.
U.S. revenues grew 14% quarter-over-quarter (QoQ), while earnings-per-share (EPS) came in at $0.06, ahead of consensus estimates of $0.05. Total revenue increased by 30% year-over-year (YoY).
However, many still worry that PLTR shares are overpriced. On November 5, Gil Luria, a technology equity analyst at D.A. Davidson, maintained a prior ‘Neutral’ rating. The researcher did raise his price target from $28 to $47, citing strong commercial adoption, but cautioning that international commercial revenue was slowing. If met, Luria’s $47 forecast would represent an 8% downside.
At the same time, Northland Capital Markets maintained a ‘Market Perform’ rating. AI and SaaS analyst Michael Latimore increased his price target to $38 from $35. The Wall Street firm uses a discounted cash flow (DCF) model for estimates and recommends purchasing the stock on dips. Northland’s price target equates to a 25.67% downside.
Mizuho analyst Matthew Broome was the most bearish — stating that “valuation cannot and should not be irrelevant”. The researcher set a $37 price target, up from $30.
It should be noted that there are plenty of bullish outlooks when it comes to PLTR stock. Dan Ives, renowned Wedbush equity researcher, who recently referred to the stock as the ‘Messi of AI’, raised his projection from $45 to $57, echoing sentiments that Palantir could become the next Nvidia (NASDAQ: NVDA).
Featured image via Shutterstock
