An analyst downgraded data analytics software maker Palantir Technologies (PLTR) on Thursday on views its valuation is inflated amid investor buzz over generative artificial intelligence. Palantir stock fell in afternoon trading.
X
Brian White, analyst at Monness, Crespi, Hardt & Co., downgraded Palantir stock to sell from neutral. He set a price goal of 20 on Palantir stock.
“On the back of this unprecedented generative AI hype cycle, Palantir surged in 2023 and the stock’s upward trajectory has continued in 2024, leaving the company with what we view as an egregiously wealthy valuation,” he said in a report.
Palantir Stock Up 43% In 2024
On the stock market today, PLTR stock fell 6.1% to shut at 23.01. As of Wednesday’s market close, Palantir stock was up nearly 43% in 2024. But shares have retreated from a high of 27.50 set on March 7.
Founded in 2003, Palantir has already mined the AI opportunity with government customers for intelligence gathering, counterterrorism and military purposes. Now Palantir goals to utilize generative AI to spur growth inside the commercial market. The software maker has expanded into health care, energy and manufacturing.
Latest generative AI models process “prompts,” paying homage to web search queries, that describe what a user desires to get. Generative AI technologies create text, images, video and computer programming code on their very own.
Palantir Stock: Technical Rankings
Palantir has not disclosed pricing for AI products.
At a customer conference on March 7, Palantir showcased its Artificial Intelligence Platform,” rolled out in early 2023. The AI platform has been gaining traction with industrial customers, Palantir said on the conference.
Palantir stock holds a Relative Strength Rating of 97 out of a best-possible 99.
“In our view, Palantir is well positioned to learn from the long-term AI trend and capitalize on volatile geopolitics,” White said. “Nonetheless, revenue from government-related contracts has proven lumpy, execution spotty and valuation is excessive.”
Also, Palantir stock holds a Composite Rating of 99 out of a best-possible 99, in response to IBD Stock Checkup.
IBD’s Composite Rating combines five separate proprietary rankings into one easy-to-use rating. Probably the most effective growth stocks have a Composite Rating of 90 or higher.
Palantir stock holds an Accumulation/Distribution Rating of B-plus. That rating analyzes price and volume changes in a stock over the past 13 weeks of trading. A+ signifies heavy institutional buying; E means heavy selling. Consider a C grade as neutral.
Follow Reinhardt Krause on X, formerly Twitter, @reinhardtk_tech for updates on artificial intelligence, cybersecurity and cloud computing.
YOU MAY ALSO LIKE:
IBD Digital: Unlock IBD’s Premium Stock Lists, Tools And Evaluation Today
Learn How To Time The Market With IBD’s ETF Market Strategy
IBD Live: A Latest Tool For Every day Stock Market Evaluation
Want To Get Quick Profits And Avoid Big Losses? Try SwingTrader