Is Palantir Technologies (NYSE:PLTR) too richly valued on Wall Street? After the powerful year-to-date rally in PLTR stock, it’s understandable if some investors don’t want to load the proverbial boat now.
It’s not a bad idea to hold a few Palantir shares because of the company’s artificial intelligence angle.
Palantir Technologies recently disclosed an collaboration that could provide a significant revenue source in the automotive market.
All in all, there’s no need to over-invest in Palantir Technologies now, but a moderately sized share allocation could benefit your portfolio in the long run.
Palantir’s Partnership With a ‘Pioneer’
Prior to 2023, financial traders mostly thought of Palantir Technologies as a cybersecurity company. Nowadays, however, Palantir is evolving into a more diversified business with a strong focus on artificial intelligence applications.
It’s a smart strategy that should enhance Palantir Technologies’ value over time. One notable example of Palantir’s focus on AI is the company’s new partnership with data analytics company J.D. Power.
Together, the two companies will develop generative AI and “predictive analytics solutions that will facilitate deeper insights and more strategic decision making by the automotive industry.”
These AI-facilitated insights will be applied to automotive safety, repairs, electric vehicle battery health monitoring and personalized engagement with vehicle shoppers and owners.
J.D. Power is a well-known data analytics services provider, so it makes perfect sense for Palantir to team up with this company.
To quote Palantir Technologies CEO Alexander Karp, J.D. Power “sets itself apart as a pioneer in data-driven intelligence and delivering lasting value for its customers.”
PLTR Stock: A ‘Generational Opportunity’ in AI
Of course, Wall Street’s experts have taken notice of Palantir Technologies’ participation in the recent AI revolution. Some of them have strongly bullish outlooks for Palantir.
For example, Wedbush analyst Dan Ives initiated his coverage of PLTR stock with an “outperform” rating and a $25 price target recently. Ives even called Palantir the “Messi of AI,” referring to famous soccer player Lionel Messi.
Palantir Technologies, according to Ives, has a “generational opportunity to gain a significant share” of what he expects to be an $800 billion TAM (total addressable market) in AI.
Ives envisions Palantir capitalizing on an “unlimited number of AI applications” that “redefine business processes across verticals.”
Ives’s bullish view of Palantir Technologies is for the long term. The analyst claims Palantir has “built an AI fortress that is unmatched and poised to be a major player in this AI Revolution over the next decade.”
For the short term, however, he’s eyeing $25 as a reasonable price objective for PLTR stock.
Don’t Fight the Trend With PLTR Stock
Ives’s enthusiasm is understandable. However, it’s difficult to predict where the Palantir Technologies share price will be in one or five years. The market may have already priced much of Palantir’s future AI-driven growth into the shares.
Therefore, there’s no need to overload your portfolio with shares of Palantir Technologies. It’s not advisable to fight the overall trend with AI technology. Companies with a strong AI connection could gain significant value in the coming quarters and years.
PLTR stock earns a confident “B” grade and is definitely worth a look. Consider a small share position in Palantir Technologies and let the AI trend be your portfolio’s friend.
On the date of publication, neither Louis Navellier nor the InvestorPlace Research Staff member primarily responsible for this article held (either directly or indirectly) any positions in the securities mentioned in this article.
