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Palantir Technologies is a top AI play and the stock could rocket to $50 a share next year, according to Wedbush Securities.
In a note published on Thursday, analyst Dan Ives said that shares of the data firm could shoot up to $50 each in 2025. A rally of that magnitude would mark 67% upside from Thursday's intraday high of around $29.80.
Backing up his bull case for the coming year, Ives noted a big demand for Palantir's AI-drive data and analytics tools from government agencies and private enterprises.
"The company has been generating significant demand across both commercial and government organizations with more customers seeing their AI strategies accelerate outside of chat to improve efficiencies and witness operational benefits with PLTR technologies," Ives wrote.
Yet, Ives added that Palantir "remains very undervalued and misunderstood by the Street."
His optimism around the company comes from strong sales of its AIP Logic platform and customers' tendency to sign on for Palantir's whole suite of tech products, which will only continue as organizations see the need for AI in different areas.
Ives also pointed to Palantir's differentiated bootcamp strategy, which walks companies through how to use AI to optimize operations.
Within a few days, some organizations are already signing years-long, multi-million dollar contracts, Ives said. He pointed to a utility company that signed a seven-figure deal just days after completing a Palantir bootcamp. In the past three months, users have completed over 500 boot camps.
Palantir has also seen outsized success amongst government agencies. The US Army recently signed a $480 million contract to use its Maven data analysis protoype.
PLTR is up 64% this year, outpacing the wider software sector's 15% gain. Ives sees Palantir's success only growing as the projected $1 trillion in AI spending by corporations is felt in the market.
