Investors who placed bets on American software giant Palantir (NASDAQ: PLTR) when the firm went public are now seeing significant returns.
Notably, PLTR’s share price has risen sharply over the past year, mainly due to its role in the booming artificial intelligence (AI) sector.
Palantir went public on September 30, 2020, and closed its first trading day at $9.50. Fast forward to the latest trading session, and the stock ended at $138.20, marking an incredible 1,354.74% increase.
To put the gains into perspective, an investor who channelled $1,000 into Palantir at its IPO would now have about $14,547, a profit of $13,547 in just under five years.
Drivers of Palantir’s stock growth
This growth comes from Palantir’s strong position in AI and data analytics. Its main platforms, Foundry, Gotham, and the AI Platform (AIP), have played a key role in this momentum.
These tools are designed to process large datasets and provide real-time insights, especially in critical sectors like defense, and have contributed to the company’s growing number of contracts.
For instance, government contracts account for a key part of Palantir’s revenue. The firm’s involvement in major initiatives, including the Department of Defense’s Open DAGIR and the $1.3 billion Maven Smart System contract, points to its growing role in national security.
At the same time, the 2025 partnership with NATO further increases Palantir’s presence in global defense operations.
Palantir has also captured the commercial clientele base, introducing AIP to over 1,000 companies and successfully broadening its customer base across logistics, manufacturing, and supply chain management.
Despite the strong rally and fundamentals, concerns remain, especially about PLTR’s stock valuation. In this line, some Wall Street analysts are cautious that Palantir’s high price may lead to a drop if the company fails to meet its growth goals.
Additionally, ongoing insider selling has raised some alarms and could impact investor confidence.
Featured image via Shutterstock
