While several tech giants have taken a hit amid the crushed hype around artificial intelligence, Palantir Technologies is an AI beneficiary that is here to stay, according to Bank of America. Analyst Mariana Mora reiterated her buy rating on the data analytics company and lifted her price target to $30 from $28, suggesting the stock can jump 24.5% from its Monday close.
"We liken the market, industry, and investor attitudes toward AI to that of the California gold rush," Mora wrote in a Tuesday note to clients, adding that the "AI rush" appears to have run dry given the recent tech sell-off. "As it was with the gold rush, the real benefactors were the entrepreneurs that supported the rush. This is where we continue to see PLTR's ultimate benefactor — the entrepreneur — the digital axe supplier that is still standing tall now that the AI tourists have started to depart," the analyst added.
On Tuesday, Palantir rose 11% after hiking its 2024 revenue forecast and also posting its largest ever quarterly profit for the second-quarter period, reinvigorating investors' faith in the generative AI boom. The software company also issued a third-quarter sales forecast that was above estimates. Shares are up more than 57% this year.
Mora updated her estimates on Palantir to support its stronger-than-expected momentum in attracting U.S. commercial and government customers.
The analyst noted that Palantir's second-quarter sales in its commercial business were up 55% year over year, def.