At its lowest on the stock market, Palantir Technologies is far from being a company in the grip of short sellers. Next year, its action will also be one of the most watched, with enormous potential for purchase according to some analysts. On the side of Bank of America, the objective is at 14 dollars (the price of Palantir is currently at 6 dollars) and the bank estimates the growth potential at 115%.
“First, the company is sitting on $2.4 billion in net cash, or about $1 per share (and it’s already profitable). Second, Palantir is working with defense contractors and service providers to expand the use of its products”wrote analysts at the North Carolina bank.
With the war in Ukraine, it is on behalf of the British army that the American company will deploy its real-time strategic decision-making tool, based on precise analysis of the progress of the conflict on the ground. A $91.4 million deal that was just announced on Friday. It will help military operations and intelligence, and will complement a first pilot project with the Royal Navy (the English navy) started two years ago.
Behind Palantir’s products is artificial intelligence technology developed for years on behalf of the United States. The CIA darling, which would have tracked bin Laden, was also used by former United States President Donald Trump, via a product called “law and order prediction”. Since then, the company has sought to diversify its revenues and cater to a larger market that includes private companies. After going public, Palantir had to invest (especially in its communication and marketing).
Palantir is better
It is for this reason, today, that the company has taken the full brunt of the correction of strategic values on the financial markets. The company whose share price fell by 66% over one year is still not profitable, but the balance is now visible. This could greatly motivate investors. Looking at the results for the last quarter, we can see that the operating loss margin is shrinking, from 23% last year to 10% today. Information to be supplemented by that of the increase in income.
The dilution of the controversial contracts with the United States will also be a way of restoring the image of the company and no longer repelling some to invest. What’s more, during the last quarter, Palantir went from 115 to 228 customers (including French customers with its presence at Station F), enough to confirm the good conduct of its plans.
In addition to monitoring armed conflicts and populations on behalf of governments, the company therefore exercises on behalf of companies. Its role is to analyze large amounts of information and extract information that would otherwise be invisible. Thanks to artificial intelligence, it can thus enable a company to improve its risk management. In early December, she signed with a well-known company on these issues: Crisis24, based in Montreal (Canada), for a contract “multi-million dollar”.