Palantir Gets Goldman Sachs Upgrade as Sovereign AI Opens New Market

Goldman Sachs upgraded Palantir Technologies Inc. (NASDAQ: PLTR ) to Buy from Neutral on Thursday, arguing that demand for sovereign AI and custom-built applications could widen the software company’s addressable market again. Analyst Gabriela Borges reiterated a 12-month price target of $230. 5% upside, according to Pro data.

PLTR stock is climbing. See the chart and price action here. Sovereign AI Drives the Call “The [total addressable market] may be setting up for another step function change in depth, because of the shift to sovereign AI, bespoke applications, and Palantir … has sustained itself even with competitor investments,” Borges wrote in a client note, CNBC reported. Sovereign AI has become central to Palantir’s own pitch.

The company credited its strong second quarter to customers who want AI built into their systems while keeping their data away from frontier labs. Read Also: Wolfspeed Stock Soars on Massive Pentagon Loan Commitment Those labs include OpenAI, Alphabet Inc. ‘s (NASDAQ: GOOGL ) Google, Anthropic and Meta Platforms Inc. (NASDAQ: META ), CNBC reported.

“Our customers have declined to become vassal states of the language labs,” CEO Alex Karp wrote to shareholders last quarter. Forward Deployed Engineers Borges also pointed to Palantir’s forward deployed engineering model, which places engineers directly with customers. The approach “requires tight feedback loops between field and product, which Palantir has perfected to the point of being able to automate via AI [engineers],” she wrote. In her view, enterprise AI adoption is still early.

“We believe enterprises are in the early stages of applying AI to their proprietary data to amplify their existing moats,” Borges wrote. Some software companies are already doing this work in-house. Borges cited CrowdStrike Holdings Inc. (NASDAQ: CRWD ) and its SafeMind cyber frontier model.

She also cited Datadog Inc. (NASDAQ: DDOG ), which applied Adaptive ML researchers to its time series forecasting data. Software firms can usually staff these projects themselves. Many other industries can’t.

“We expect industries with lower tech talent density to be an opportunity for Palantir,” Borges wrote. 8 billion. S. S.

government revenue grew 90% to $809 million. 66 billion. ” Wall Street Already Leans Bullish Goldman now joins most of the Street in the bullish camp. Pro data shows 16 of the 21 analysts tracked rate Palantir a Buy, four rate it a Hold and one rates it a Sell, for a consensus Buy rating.

3% above the current share price. 6% higher than that average. PLTR Stock Price Action: Palantir shares have gained nearly 47% over the past three months. The rally came after a rough first half.

5% in one day on Aug. 4. 65 in premarket trading, according to Pro quote data. Read Also: Starlink Cash Can Carry SpaceX's $40 Billion AI Tab, Dan Ives Says Photo: Shutterstock