Artificial Intelligence (AI) has been the talk of Wall Street and Main Street this year, with its rapid evolution and wide-ranging potential applications, specifically Palantir. From creating original content to writing code, the possibilities of generative AI are still being explored. Investment banks Morgan Stanley and Goldman Sachs predict that productivity gains from AI could add $6 trillion and $7 trillion annually to the economy by the end of the decade, respectively.
Wedbush analyst Dan Ives identified Palantir Technologies (PLTR 11.40%) as an overlooked gem in this AI gold rush. He has likened the company to Lionel Messi, the legendary soccer player, calling Palantir the “Messi of AI.” Ives is a Managing Director and Senior Equity Research Analyst covering the Technology sector at Wedbush Securities since 2018. He is notable for his piece on why tech stocks will roar into year-end despite ongoing uncertainty — his 4 best options for investors.
Why Messi?
Lionel Messi, the Argentinian soccer star, is globally recognized as one of the most accomplished players in the sport. With a record seven Ballon d’Or awards and leading Argentina to a FIFA World Cup victory, Messi’s career is filled with remarkable achievements. By comparing Palantir to Messi, Ives suggests that the company could achieve similar greatness in AI.
Palantir becomes the AI pioneer
Ives recently initiated analyst coverage of Palantir with an outperform (buy) rating and a $25 price target, indicating a 55% potential upside for investors. He believes that Palantir has built an unmatched AI fortress and is set to be a significant player in the AI revolution over the next decade.
In an interview with CNBC’s The Exchange, Ives elaborated on his bullish stance, stating that Palantir has a golden opportunity to monetize a potentially $1 trillion market. He also mentioned that for enterprise CIOs considering AI adoption, Palantir should be their first call.
Palantir’s 20-year history with AI, including work for the CIA, FBI, and National Security Agency, gives it a unique advantage. Ives suggests that Palantir’s experience with top-secret government work makes it a reliable choice for enterprises concerned about data security.
The future of Palantir
Despite a 76% drop from its peak in 2022, Palantir’s stock has seen a 209% increase since the beginning of 2023. The company’s current valuation is 15 times next year’s sales, which may seem high. However, Ives’ $25 price target is about 10 times his fiscal 2027 revenue estimates of $5 billion, a significant improvement from Palantir’s 2022 revenue of $1.9 billion.
While the stock’s recent performance might deter some investors, Ives’ comparison of Palantir to Messi suggests that the company’s potential is far from realized. As the AI revolution unfolds, Palantir could be a stock to watch.
Messi is undeniably one of the greatest players in soccer history, and by invoking his name, Ives likely believes that Palantir can achieve similar greatness. While some might fear it’s too late to invest in Palantir, the stock — like the AI revolution — is just getting started.
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