William Blair analyst Louie DiPalma has maintained their neutral stance on PLTR stock, giving a Hold rating on July 16.
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Louie DiPalma has given his Hold rating due to a combination of factors surrounding Palantir Technologies. One significant aspect is the recent consolidation of Palantir’s contracts with the U.S. Army into a $10 billion, 10-year enterprise agreement, which includes volume-based discounts. However, the lack of specific details about these discounts suggests they may not be as substantial as those offered to other software vendors, such as Docusign and Salesforce, which have seen discounts as high as 70% to 90%.
Despite this, Palantir is expected to increase its annual recurring revenue (ARR) from the Army, potentially reaching $600 million with new contract wins and expansions. The company’s recent success in securing $135 million in ARR from various government contracts in the second quarter, a significant rise from the previous year, indicates growth potential. However, the uncertainty surrounding the exact impact of the discounts and the competitive landscape leads to a cautious Hold rating.
In another report released on July 16, Mizuho Securities also upgraded the stock to a Hold with a $135.00 price target.