Palantir Technologies Inc., a big data firm that offers enterprise software to the government and commercial businesses, recently showed its AI ambitions in its first-quarter earnings call. The move to integrate its data capabilities with AI is promising and has excited investors. With big tech companies like Microsoft, Alphabet, Amazon, and Nvidia dominating the AI space, Palantir has remained under the radar. However, Palantir’s Artificial Intelligence Platform (AIP) has the potential to make a huge impact on both the public and private sectors.
Palantir offers software that synthesizes unstructured data from disparate systems to provide actionable insights. Palantir’s clients include financial institutions like Wall Street banks, healthcare companies, supply chain operations, and the government. Cathie Wood, a tech investor and media darling, had invested in Palantir in 2020 and 2021. She later sold her stake due to concerns about the company’s growth prospects and the competitive landscape. However, Wood surprised investors by buying Palantir stock back, following the unveiling of the AIP.
The AIP can be used to detect harmful equipment and adversaries in the area, deploy drones to capture specific imagery, and provide different game plans and scenarios for military simulation. Furthermore, Palantir’s large language models (LLMs) can be utilized in areas like fraud and identity theft, logistics and inventory management, and so much more. When Palantir released its Q4 2022 earnings in February, its full-year 2023 revenue guidance was between $2.18 billion to $2.23 billion. After the announcement of AIP, Palantir slightly raised its revenue guidance. Although AIP is still in its early days, customer demand for it is high, and the updated guidance may very well be underestimated as the need for AI continues to grow.
Palantir stock has risen by over 60% in the last month due to the promising development in AIP that could make it a player in AI. While it is difficult to recommend waiting to purchase Palantir’s stock, it is recommended to dollar-cost average into the stock. Compared to other companies in the AI space, Palantir’s stock is not fully priced in, and investors have yet to see it as a player in AI. The stock looks like a fantastic buy at its current valuation and could very well be a discounted AI play.
