An analyst at Monness, Crespi, Hardt & Co. downgraded Palantir Technologies (PLTR), a data analytics software maker, on Thursday due to concerns of an inflated valuation amidst the excitement surrounding generative artificial intelligence. The stock of Palantir fell during afternoon trading. Brian White, the analyst, downgraded Palantir stock from neutral to sell and set a price target of 20. In a report, he stated, "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 rich valuation. " Palantir stock experienced a 43% increase in 2024. However, it fell 5. 7% to 23. 11 during afternoon trading on the stock market today. The stock had reached a high of 27. 50 on March 7 but has since retreated. Established in 2003, Palantir has already utilized AI with government customers for intelligence gathering, counterterrorism, and military purposes.
Now the company aims to leverage generative AI for growth in the commercial market, expanding into sectors such as healthcare, energy, and manufacturing. Generative AI models process "prompts" to generate text, images, video, and computer programming code autonomously. Palantir has not disclosed the pricing for its AI products. At a customer conference on March 7, Palantir presented its Artificial Intelligence Platform, which was introduced in early 2023. The platform has gained traction with commercial customers, as revealed during the conference. While Palantir is well positioned to benefit from the long-term trend of AI and capitalize on geopolitics, White believes that revenue from government contracts has been unpredictable, execution has been inconsistent, and the stock is overvalued. Palantir stock holds a Relative Strength Rating of 97 and a Composite Rating of 99 according to IBD Stock Checkup. The Accumulation/Distribution Rating for the stock is B-plus. For updates on artificial intelligence, cybersecurity, and cloud computing, follow Reinhardt Krause on X (formerly Twitter) @reinhardtk_tech. YOU MAY ALSO LIKE: - Unlock IBD's Premium Stock Lists, Tools And Analysis Today with IBD Digital. - Learn How To Time The Market with IBD's ETF Market Strategy. - IBD Live: A New Tool For Daily Stock Market Analysis. - Want To Get Quick Profits And Avoid Big Losses?Try SwingTrader.
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