Palantir Technologies could become a "core winner" in the trillions of artificial-intelligence spending over the next few years, Wedbush analysts said as they raised their price target on shares of the software company.
Palantir stock was up 1.8% on Thursday. Analysts led by Dan Ives maintained an Outperform rating and raised their price target to $90 from $75, suggesting a potential 19% upside.
While the valuation is expensive today, Palantir "has a path to become the next Oracle or Salesforce over the coming years," the analysts wrote. Their bull thesis is rooted in the company's AI strategy, with Palantir seeing "unprecedented demand" for its AI platform from both commercial and federal clients.
In particular, Palantir's "enhanced product portfolio of advanced AI capabilities" continues to gain traction across various government agencies, the analysts said.
"To this point we believe the Trump administration represents an additional tailwind," the analysts wrote, nodding to the recently unveiled Project Stargate initiative. "In essence, Palantir is in the sweet spot to benefit from a tidal wave of federal spending on AI."
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