Palantir Technologies (NASDAQ:PLTR) has enjoyed some early Christmas cheer in 2024, with its stock surging by 369% on the back of booming AI demand.
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The big data powerhouse continues to win over both government and corporate clients eager to leverage its proprietary software for enhanced real-time decision-making.
Demonstrating its growing influence, Palantir announced last week an expansion of its partnership with the U.S. Army, a deal that could be valued at up to $618.9 million.
In addition, starting tomorrow, Palantir will join the NASDAQ-100 – a milestone that will prompt funds and financial products tracking the index to incorporate the company’s shares into their portfolios.
That said, with such a meteoric rise in its stock price, one has to wonder: Has PLTR’s valuation climbed too far, too fast?
Not at all, argues Noah’s Arc Capital Management, a 5-star investor ranked in the top 4% on TipRanks’ stock pros leaderboard.
“The company and its customers have access to data that is unparalleled, often classified and extremely valuable,” remarked Noah’s Arc. “This puts Palantir in an incredibly opportune position.”
The investor further explains that the evolution of Large Language Models (LLMs) will rely increasingly on robust data sets and multiset reasoning processes rather than solely on GPU cluster size. The path to developing Artificial General Intelligence (AGI) will hinge on combining “great LLMs, unique database structures, and key data sets.”
Palantir, Noah’s Arc argues, excels in all three areas. “What matters going forward is data,” the investor emphasized. And “Palantir has an edge here.”
Another major reason for a bullish approach, according to Noah’s Arc, is the next U.S. administration. The investor expects PLTR to be intimately involved in working with the Department of Government Efficiency to locate potential areas to cut Federal spending.
“The company is arguably on the best path to AGI of any publicly traded company because it has an incredibly unique data structure, and access to the rarest forms of data,” writes the investor, who touts PLTR’s recent access to even better versions of classified government data.
Building on this conviction, Noah’s Arc rates PLTR shares a Strong Buy, hinting that the magic of Christmas could extend well beyond December. (To watch Noah’s Arc’s track record, click here)
The investor’s enthusiasm, however, is not matched on Wall Street. With 2 Buy, 8 Hold, and 6 Sell recommendations, PLTR claims a consensus Hold (i.e. Neutral) rating. Its 12-month average price target of $39.36 represents a 51% downside potential from current levels. (See PLTR stock forecast)
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Disclaimer: The opinions expressed in this article are solely those of the featured investor. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
