Deemed as one of the revolutionary companies that combine AI and military technology, experts see Palantir’s (NYSE: PLTR) stock as a ‘diamond in the rough’ yet to showcase its full potential.
Indeed, the signs of Palantir’s potential are already evident. PLTR stock has demonstrated robust growth, surging by an impressive 26.30% since the start of 2024. This growth is further substantiated by solid revenue and financials, as indicated in the latest Q1 report released on May 6.
Despite this, some analysts are worried about the future and see the missed guidance for the next quarter and full year as a warning sign, especially with reliance on government contracts.
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Nevertheless, Palantir secured another $480 million contract with the U.S. Army, showcasing that despite doubts, it still has much to offer.
$480 million contract is bound to bolster Palantir’s financials
The U.S. Army has awarded a $480 million contract to Palantir Technologies Inc. subsidiary for the Maven Smart System project, with work extending through 2029, according to a report from Bloomberg on May 30.
This contract, announced on the same date as part of the Defense Department’s daily updates, will deepen Palantir’s partnership with the military.
The Maven project utilizes Palantir’s expanding suite of artificial intelligence tools to help soldiers quickly and accurately identify targets using AI and computer vision. Palantir has been developing this technology for the Army since 2018, following Google’s withdrawal from the contract.
Palantir stock already reacted positively to the news
Despite PLTR stock losing 0.52% and closing at $20.94 during a negative trading session, the pre-market showed a more positive trend. Palantir’s shares had increased by 2.82% at the time of writing, with gains expected to continue until the markets open.
The $480 million U.S. Army deal was bound to boost PLTR stock’s performance, and while some remain concerned about the overreliance on government contracts, this boost is more than welcome.
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