Following Palantir’s (NASDAQ: PLTR) breakthrough as a key player in artificial intelligence (AI) software, Wedbush Securities analyst Dan Ives has identified the next stock to follow suit.
As a recap, the share price of PLTR has continued to register new record highs, driven by the company’s venture into AI and key partnerships.
Recently, Palantir hit a new record, closing at $71.24 during the last trading session, with daily gains of nearly 7%. Year-to-date, in 2024, PLTR has surged 327%.
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The latest momentum emerged after the software giant achieved a new milestone under the Federal Risk and Authorization Management Program (FedRAMP).
This authorization sets security and risk standards for federal cloud services, elevating Palantir’s standing as a trusted provider of secure cloud solutions for government operations.
Notably, despite these developments, analysts continue to give Palantir mixed outlooks, with valuation concerns remaining a major issue. Nevertheless, institutional investors are buying the stock at a high rate.
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Now, Ives sees another software giant, Salesforce, as a key contender in the growing AI space, which he expects to expand further in 2025.
Ives emphasized that 2025 could mark a pivotal year for technology companies as the broader sector accelerates AI adoption. He highlighted Salesforce’s advancements as a critical indicator of the ‘exploding’ software use cases for AI.
“2025 the rest of tech gets into the AI party and this speaks to our bullish tech thesis into the next 12 to 18 months. Software use cases exploding (CRM key data point) being led by the Messi of AI PLTR,” he said.
Referring to Palantir as the ‘Messi of AI,’ Ives pointed out that industry leaders such as Nvidia (NASDAQ: NVDA), Tesla (NASDAQ: TSLA), Apple (NASDAQ: AAPL), and cloud computing players are positioned to capitalize on the ongoing AI revolution. He reiterated his bullish outlook on the tech sector over the next 12 to 18 months.
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The outlook from Ives follows Salesforce’s recent surge after the company announced an optimistic outlook and AI-powered growth.
As of press time, CRM was trading at $358, having made modest gains of 0.13% in the last 24 hours. The positive sentiment is highlighted by the stock’s pre-market trading on December 4, where it is up over 13%, trading at $374.
For the third quarter, Salesforce reported adjusted earnings of $2.41 per share, slightly below analysts’ expectations of $2.44. However, revenue of $9.44 billion exceeded estimates of $9.35 billion, marking an 8% year-over-year increase.
Subscription and support revenue grew 9% to $8.88 billion while operating cash flow rose 29% to $1.98 billion.
Key highlights from the quarter include the $1.9 billion acquisition of Own Co. to enhance data and loss protection capabilities, the launch of the Agentforce Partner Network, and plans to integrate technology from its $450 million acquisition of Zoomin Software.
Additionally, Salesforce introduced its Financial Services Cloud for Insurance Brokerages, aiming to deepen client relationships with AI-driven tools.
The company emphasized that its AI ecosystem is at the core of its transformation.
“Agentforce, our complete AI system for enterprises built into the Salesforce Platform, is at the heart of a groundbreaking transformation.<…> The rise of autonomous AI agents is revolutionizing global labor, reshaping how industries operate and scale,” Marc Benioff, chairman and chief executive officer of Salesforce.
In conclusion, the outlook for Salesforce remains bullish; however, the company is not guaranteed to follow Palantir’s path, as the AI space is highly competitive.
Featured image via Shutterstock
