Can Palantir challenge big tech’s dominance?

Palantir Technologies Inc (NYSE: PLTR) is set to disrupt the dominance of big tech, including Amazon, Microsoft, and Google, according to Rahul Bhushan, the managing director of Ark Invest Europe.

Most of the investments in artificial intelligence have so far gone into chips and hardware at large.

But the real value within this space may lie in the software-focused companies, he told CNBC in an interview today.

Palantir stock is up 150% year-to-date at writing. It is currently one of the top 10 names in the flagship Ark Innovation Fund.   

Palantir is different than its big-tech peers

Palantir has a meaningful edge over the tech titans as it offers tailored solutions to its customers.

The New York-listed firm helps organizations consolidate their data that’s typically scattered all over the place.

Then it taps into artificial intelligence to “derive insights from that and recommend actions,” as per Bhushan.

Shares of Palantir Technologies are broadly expected to show resilience if the US economy slides into a slowdown in the coming months.

That’s because the company generates most of its revenue from large enterprises and government contracts – two types of customers that tend to remain strong against a challenging backdrop.

But it’s not like PLTR is lagging in the commercial space either.

The data analytics firm forecasts up to a 47% annualized growth in its US commercial sales in 2024. So, the Palantir stock price looks poised for further gains as its management continues to diversify the customer base.

Palantir stock could hit $100 in a few years

Palantir may also be worth owning in writing as it has recently become a part of the S&P 500 which historically drives institutional interest in a stock.

Additionally, shares of the company based out of Denver, Colorado remain undervalued despite the massive year-to-date rally since they are still going for a forward price/earnings-to-growth multiple of significantly less than 1.

That’s part of the reason why Greentech Research analyst Hilary Kramer is super bullish on PLTR share price and expects it to surpass $100 over the next few years.

Her forecast indicates potential for another 150% upside from here, which more than makes up for a lack of dividend yield.

All in all, Palantir stock may not make you a millionaire, at least not in the next few years – but it’s a notable AI beneficiary that’s fully committed to diversifying its revenue streams and delivering profitable growth to command a higher price tag moving forward.

The post Can Palantir challenge big tech's dominance? appeared first on Invezz