Palantir (NYSE:PLTR) will be releasing its earnings for Q3 2024 just ahead of the momentous U.S. presidential election on Tuesday. Although this report will attract slightly less attention than the race for the White House, investors will be closely analyzing the numbers to gauge the direction of the big data analytics company.
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Palantir has been one of the shining stars in 2024. The company has taken firm advantage of the excitement surrounding AI and has now delivered seven straight quarters of profits. Coupled with a growing customer base and a slew of large contracts from both commercial and government sectors, Palantir shares are up 144% for the year.
Despite concerns that such rapid share price growth may signal an overextended valuation, investor Michael Del Monte remains confident in Palantir’s potential.
“Despite high valuation, the addition to the S&P 500 and strong momentum suggest Palantir shares can sustain higher valuations,” the investor opined.
Del Monte attributes his confidence to several key factors, including Palantir’s robust portfolio of high-profile deals. Recently, for example, Palantir partnered with L3Harris to support the U.S. Army’s modernization efforts. In national security, Palantir also secured a contract with DEVCOM Army Research Laboratory and announced a joint venture with Microsoft to enhance analytical capabilities for U.S. defense and intelligence.
Palantir’s reach extends beyond government contracts. In September, the company signed new agreements with Nebraska Medicine and BP, alongside a multiyear extension with APA Corporation, furthering its footprint in the commercial sector.
“Palantir’s AI software platform has proven to be a profitable addition to enterprises’ software stack, driving both new customer acquisition and contract extensions with existing customers,” Del Monte noted, increasing his expectations for both Q3 and Q4 2024 in light of these significant developments.
In addition, Palantir’s inclusion in the S&P 500 this past quarter gives Del Monte additional confidence “that PLTR shares will have the ability to support a higher valuation despite the appearance of being overextended.”
With all these achievements under its belt, Del Monte rates PLTR shares a Strong Buy. (To watch Del Monte’s track record, click here)
However, Wall Street analysts are more cautious. With 4 Buy, 7 Hold, and 6 Sell ratings, PLTR has a Hold consensus rating (i.e. Neutral). Moreover, its 12-month average price target of $27.85 suggests a potential downside of 33.5% for the coming year. (See PLTR stock forecast)
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Disclaimer: The opinions expressed in this article are solely those of the featured investor. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.
