Transcription
I want to talk about Palantir. Who better to talk with than Dan Ives of W. Bush? Dan, I'll tell you, your good friend here, Einstein Peter Tuckman, always quotes your outperform ratings and your price targets often when I speak with him. In fact, everybody here on Wall Street is, um, as you well know.
I'll give you the U on the surround victory lap on Palantir here, which you originally called the "Messi" of AI, like for soccer, for Lionel Messi. But now you're calling it something new and bigger.
Look, I mean, Nicole, I think this is really the AI revolution that ultimately is being led by, of course, names like Nvidia and Microsoft and others. But Palantir, if you look at what they're doing here, I think this could be the next Oracle or Salesforce. I mean, this was a quarter for the ages that should be hung up in the glow when they print that press release off.
I think this is really the start of the next phase of growth for Palantir, which continues to be the dominant AI player. The investment firm's analysis suggests that as more enterprises recognize the value of Palantir's product offerings, the demand for the company's AI solutions will see an unprecedented rise.
So really, I mean, when you talk about it being the, you know, I saw that you were calling it the next Oracle or Salesforce. Is there going to be a price to be paid by another name in the biz if Palantir is growing so much? Does someone else pay the price?
I don't think so. I mean, look, I believe this could be a trillion-dollar market cap over the next two to three years. You and I have talked for years. You can just look at these companies on evaluation over the next year. You have to look through what this company is doing, and I believe this is a generational type of compounder.
But I think, look, last night was a jaw-dropper, and it showed fundamentally, I'd say outside of Nvidia in terms of some of those earnings, there's no other print and guide that I can remember in the last few years that matches Palantir.
He is looking to the future where he sees a transformation of the enterprise space and a vital role for the company. Palantir's approach to AI is singularly valuable, he said.
Do you feel like, um, I have to move on, but Elon Musk, you know, there was a point that we were waiting for the adult in the room. I think that's what you said, or maybe putting his big boy pants on or something when he was sort of avoiding the questions in a few of the earnings calls.
Do you feel like he's ready to run the country with President Donald Trump and Ron Tesla? Look, in terms of Tesla, I mean, I think they are in just a massive position of strength in terms of the next six to twelve months.
But you and I have talked about, I think the biggest hurdle was the regulatory spiderweb. I mean, I'll take a Karate Kid reference, the "sweep the leg" moment in the Beltway, and that ultimately will be a positive when it comes to autonomous in the federal roadmap, not on the state level.
I think that ultimately starts what's going to be, is this autonomous, you know, what I believe is probably the biggest opportunity along with Optimus that Tesla's ever had.
He is looking to the future where he sees a transformation of the enterprise space and a vital role for the company. Palantir's approach to AI is singularly valuable, he said.
Yeah, and you know, of course, he's sort of a friend of China too, which doesn't hurt him. He figured out the China web, and in fact, I think they love his mother. I heard today, I mean, so I think he's got a win with that.
Tell me about Microsoft. You did mention Nvidia and Microsoft at the top as two nuclear leaders. Are Nvidia and Microsoft still leaders in your mind? Would you buy them today?
I think Nvidia is a table pounder here despite, you know, obviously the sell-off. 15 to 1 continues to be demand to supply in terms of Nvidia chips. We love the tariff and other issues.
Palantir Technologies Inc. builds agile solutions for data-driven operations and decision-making. Its artificial intelligence platform, AIP, has transformed its business, which is used to test, debug code, and evaluate AI scenarios. That continues to be what I view as one of the core AI plays. Nothing has changed in my view.
I think Microsoft right now has negative sentiment, but it was a capacity issue. The actual AI business has a $13 billion runway. More and more, this is going to become an AI story, and I think this is just really what I'll call just a pause in what's going to be just a massive growth cycle for Microsoft if the street is underestimating.
Yeah, we'll be looking at a $2 trillion market cap by the end of this year. There are a lot of people who think that he's not getting the okay regulatory approval to have FSD in the way that he's hoping. Is that going to be a major hurdle?
I mean, look, the haters hate, right? I mean, they hated this sub $100 million, sub a billion, and of course, you know, as it got to a trillion.
Palantir's stock closed at a low of $6 in December 2022 and is now trading north of $76, up more than 1,000% from that bottom.
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I think FSD in terms of Austin unsupervised, that's going to happen in June. That's six to nine months ahead of where the street expected. Look, I get timelines; it's going to get pushed around, but that is the story right now for Tesla.
It is about the autonomous piece of this story, and I continue to believe with Musk front row seat in the Trump White House, it's a bet for the ages that's going to continue to pay off for Tesla shareholders.
Strong support for the Department of Government Efficiency and Tesla Inc. CEO Elon Musk during a Fox News interview on Thursday highlighted the growing intersection of technology and government reform.
What up? I wholeheartedly support Doge, and you cannot have a better person than Musk, KP stated, aligning with Doge co-lead Vivek Ramaswamy's efforts for government reform.
The company's political influence continues to expand, with recent reports suggesting that Palantir's Chief Technology Officer, Shyam Sankar, is reportedly being considered for the Pentagon's top research and engineering position under President-elect Donald Trump's administration.
This development comes as Palantir's market value reached $159 billion, surpassing traditional defense contractor Lockheed Martin Corp. The tech giant's influence extends through its founder Peter Thiel's strong ties to both Trump and Vice President-elect JD Vance.
Also, a federal judge rejects Boeing's plea deal in the 737 Max fraud case, citing concerns over diversity policies and monitor selection. Why it matters: These connections, coupled with Palantir's recent partnership with Amazon Web Services to provide Anthropic's Claude AI models to U.S. intelligence agencies, underscore the company's growing political and technological clout.
Wedbush Securities Managing Director Dan Ives has identified Palantir as a front runner in enterprise AI transformation, calling it the biggest tech trend in the last 40 to 50 years.
During the interview, KP emphasized the company's AI capabilities. "We've managed our model in AI so that it actually delivers value on the battlefield to bring soldiers home, to kill enemies, or commercially to change margins."
The company's expansion in government contracts and AI partnerships has driven significant growth, with its stock surging 93% since its inclusion in the S&P 500 in September.
Price action: Palantir's stock closed at $7.18 on Thursday, up 2.89% for the day. In after-hours trading, the stock increased by 30%. Year-to-date, Palantir's stock has surged by 33,347%.
According to data from Benzinga Pro, Palantir has a consensus price target of $30.2 based on 18 analysts. The highest target is $75, and the lowest is $7.50.
The recent ratings from Wedbush and Goldman Sachs suggest an average target of $63.6, implying an 11.68% downside.
Palantir's stock was rising Friday after the software company unveiled a partnership with the federal defense contractor Booz Allen Hamilton to accelerate defense mission innovation and help the U.S. maintain military superiority.
Palantir has worked with Booz Allen, a government and military contractor specializing in intelligence, since 2020. Palantir has also partnered with the Army since 2008 and gets a significant portion of its revenue from government agencies.
Last month, the company reported third-quarter government revenue had increased 40% from a year prior. Still, analysts at William Blair wrote Friday that the company has fallen behind in terms of the goals it has laid out.
The company's revenue is still tracking to miss management's 2025 target of $4.5 billion, conveyed in August 2022, by over $700 million. Analysts led by Lou DePalmer wrote the collaboration isn't likely to significantly change Palantir's revenue, seeing as Booz Allen itself is the leading provider of government IT analytics.
The analyst said Booz Allen also works with Palantir's rivals, Databricks and Snowflake. They added the consulting firm built its data analytics platform, Advana, in collaboration with Databricks.
The U.S. Department of Defense describes Advana, rather than Palantir, as the DOD's largest big data platform. The analyst said William Blair rates the stock at underperform.
Palantir's stock rose on Tuesday after the company said it had been granted FedRAMP High authorization, which enables the government to use its entire product suite in processing sensitive workloads.
It's been a monumental year for Palantir Technologies Inc., which has seen its business light up with accelerating sales growth fueled in part by momentum for its artificial intelligence offering.
That's driven milestones for the SH as well. Palantir's stock was building on its gains in Friday's session, up 6% on the day and 344% on the year.
Palantir shares had been polarizing before this year's big ascent, and voices on both sides of the opinion divide have made themselves heard recently.
Daniel Ives of Wedbush, who's the biggest bull among Wall Street analysts with his $75 target price, recently predicted unprecedented demand as more enterprises realized the value of Palantir's entire product suite with more AI use cases.
Palantir's Chief Executive Alex Karp doesn't have much patience for those who say the stock is overvalued. "That's exactly what they said at Mark B," he told MarketWatch on Thursday.
Palantir's stock closed at a low of $6 in December 2022 and is now trading north of $76, up more than 1,000% from that bottom.
They said we wouldn't be profitable. They said we wouldn't be able to IPO. Then they said it was only a flash in the pan because we couldn't be cash flow positive. They said our profitability was a flash.
He said Palantir has been profitable on a GAAP basis dating back to the December quarter of 2022. Karp doesn't think the stock is controversial and says that people who understand the company's AI technology are going to watch what Palantir is doing.
He is looking to the future where he sees a transformation of the enterprise space and a vital role for the company. Palantir's approach to AI is singularly valuable, he said.
The company makes software for governments and businesses. Speaking at a corporate event Thursday, Karp said Palantir AI will help companies realize the core essential meaning of their business.
That's massively transformative in his view, except for the people who don't do it. While Palantir shares are up 37% in the last month alone, the critics remain vocal.
In our view, market conditions similar to what took place in 2022 could trigger a correction if they were to recur, William Blair analyst Lou DePalmer wrote recently.
In the past, he said Palantir shares declined as revenue growth decelerated and there was increased scrutiny on valuation. As Barron's reported earlier, Palantir stock was leading the list of contenders to join the NASDAQ 100 during its annual reconstitution.
Any changes to the index will be announced December 13. What to know: The partnership focuses on two primary objectives: modernizing information infrastructure to ensure secure interoperability and accelerating integrated warfighting operations with coalition partners through data-centric systems.
These initiatives are designed to improve communication and collaboration between the U.S., its allies, and its partners on a global scale. Booz Allen Chairman and CEO Arash Azarshahi emphasized the importance of an agile approach to national defense, stating that the joint effort had already produced a prototype within 45 days.
Palantir CEO Alex Karp underscored the company's commitment to supporting Western defense efforts, noting that the collaboration will integrate artificial intelligence and advanced hardware to enhance the U.S. military's operational capabilities.
This partnership builds on prior collaborations between Palantir and Booz Allen, which have supported multiple programs for the U.S. government. The companies intend to explore further opportunities for co-creation, intellectual property development, and teaming across various defense missions.
The announcement also follows other recent developments for Palantir, including its expanded collaboration with Shield AI to develop large-scale autonomous command and control systems.
Shield AI technology, combined with Palantir's software solutions, aims to address critical defense challenges even in GPS and communication-denied environments.
The broader context for these partnerships includes the potential impact of future U.S. government defense budget adjustments. Proposals for increased government efficiency under a possible Trump administration could potentially place additional pressure on defense spending, a sector that has already reached historic highs.
Analysts have noted that defense contractors, including Booz Allen, could face challenges in maintaining growth in light of these dynamics.
They said we wouldn't be profitable. They said we wouldn't be able to IPO. Then they said it was only a flash in the pan because we couldn't be cash flow positive. They said our profitability was a flash.
He said Palantir has been profitable on a GAAP basis dating back to the December quarter of 2022. Karp doesn't think the stock is controversial and says that people who understand the company's AI technology are going to watch what Palantir is doing.
He is looking to the future where he sees a transformation of the enterprise space and a vital role for the company. Palantir's approach to AI is singularly valuable, he said.
The company makes software for governments and businesses. Speaking at a corporate event Thursday, Karp said Palantir AI will help companies realize the core essential meaning of their business.
That's massively transformative in his view, except for the people who don't do it. While Palantir shares are up 37% in the last month alone, the critics remain vocal.
In our view, market conditions similar to what took place in 2022 could trigger a correction if they were to recur, William Blair analyst Lou DePalmer wrote recently.
In the past, he said Palantir shares declined as revenue growth decelerated and there was increased scrutiny on valuation.
Kramer discussed Palantir Technologies Inc.'s recently reported impressive quarter and federal contracts and mentioned he liked its defense business.
What don't we start with Palantir, which reported one of the best quarters of the year? Fantastic growth, fantastic gross margins. That's right, growth and gross margins together. That is fabulous, and they're killing it with federal contracts, including some important work for the Pentagon.
Palantir's people tend to win almost everything that they tender for. They also have a great commercial group, but I like their defense work. It's what I used to call a total upstock.
Palantir is a prominent developer of advanced software platforms that specialize in integrating and analyzing complex data to aid in decision-making. Known for its work with government agencies, it provides essential tools for data-driven operations.
Earlier this year, the company secured a significant $480 million contract from the U.S. Department of Defense to develop a prototype called the Maven Smart System. This contract, expected to be completed by May 2029, marks a further deepening of the company's relationship with the Pentagon following a sole bid solicitation from the Defense Department.
Additionally, we talked about the company's third-quarter earnings report in our article, Jim Kramer's Best Performers List, Top 10 Stocks. Here is an excerpt from the piece: Palantir's U.S. government travel saw particularly strong growth within its government business. Revenue from government contracts rose 33% year-over-year to $48 million, with U.S. government revenue alone surging by 40%, reaching $320 million.
This marked the highest growth the company had experienced from its largest customer in 15 quarters. In November, Palantir entered into a partnership with Anthropic and Amazon Web Services to offer U.S. intelligence and defense agencies access to the Claude 3 and 3.5 model families on AWS.
The integration of these Claude models within Palantir's data analytics platform will help government agencies process large amounts of complex data, rapidly identify patterns more effectively, streamline document review, and assist in making informed decisions during time-sensitive situations.