11 AI Stocks Analysts Are Watching Closely

8. Palantir Technologies Inc. (NASDAQ:PLTR)

Number of Hedge Fund Holders: 81

Palantir Technologies Inc. (NASDAQ:PLTR) is one of the 11 AI Stocks Analysts Are Watching Closely.  On December 10, William Blair analyst Louie DiPalma reiterated a Market Perform rating on the stock. The rating affirmation follows Palantir’s $448 million contract with the U.S. Navy to manage the supply chain of its nuclear submarine fleet.

“Yesterday, the U.S. Navy awarded Palantir a $446 million contract to provide its software to two shipbuilders and over 100 suppliers in the submarine industrial base to accelerate submarine production.”

While the Navy contract award holds the potential to become one of Palantir’s largest, even larger than Maven, the firm remains neutral on the stock amid broader valuation and growth considerations.

Over the past few years, the US Navy has taken measures to resolve bottlenecks that pushed submarine production rates to fall below its targets for both the Virginia-and Columbia class (two plus one).

These initiatives have begun to bear fruit. General Dynamics reported on its third earnings call that its maritime division reported 14% revenue growth in the third quarter after rising 22% growth in the previous quarter. Meanwhile, major Navy supplier Curtiss-Wright also improved its Navy outlook in each of the past two quarters.

“The U.S. Navy indicated that there is also the potential to expand the software beyond the submarine industrial base to other platforms. Palantir already has maritime supply chain partnerships with Hyundai Heavy Industries, Babcock, Saildrone, and Saronic.”

Palantir Technologies Inc. (NASDAQ:PLTR) is a leading provider of artificial intelligence systems.