1. Palantir Technologies Inc. (NASDAQ:PLTR)
Renaissance Technologies Q4 Stake: $1.72 billion
Number of Hedge Fund Holders: 64
Palantir Technologies Inc. (NASDAQ:PLTR) is a software and data analytics company that develops platforms for large corporations, financial institutions, and government organizations to analyze massive amounts of data. Its government sector serves customers from the US government and non-US government agencies, while the commercial segment oversees clients from various non-governmental industries.
On May 6, Cantor Fitzgerald raised its price target for Palantir Technologies Inc. (NASDAQ:PLTR) from $98 to $110 with a Neutral rating on the stock. This change follows Palantir’s first-quarter 2025 earnings, which beat the Visible Alpha consensus by 2.5%. The company attributed this outperformance to strong results in the U.S. commercial sector, where revenue surpassed projections by 10%, and overall government revenue, which was 5% higher than anticipated. However, Cantor Fitzgerald observed that the degree of revenue outperformance was lower compared to the prior quarter, despite the report’s positive aspects. Due to persistent challenges across Europe, international revenues, especially among the commercial sectors abroad, fell 16% short of projections.
Ithaka US Growth Strategy stated the following regarding Palantir Technologies Inc. (NASDAQ:PLTR) in its Q1 2025 investor letter:
“From the front-lines of warzones to Fortune 500 enterprises, Palantir Technologies Inc. (NASDAQ:PLTR) builds software to address high-level action items, respond to defense and security concerns, and improve organizational efficiency. The company offers a number of software products from data analysis and curation (Palantir Gotham and Foundry) to a cloud-based operations software (Apollo). The company rose to popularity, in part, due to several government contracts (~55% of revenues) arising from recent and continuous global conflicts. In addition to creating generative AI defense solutions for governments across the globe, commercial customers (~45% of revenues) have flocked to the company’s security and data analysis solutions to monitor and analyze business data and protect sensitive information. The stock’s rise in the quarter was due to a strong earnings report that beat Street expectations as well as investor excitement with regard to the company’s ability to further monetize its AI product across its growing customer base.”
While we acknowledge the potential for PLTR as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than PLTR but trades at less than 5 times its earnings, check out our report about this cheapest AI stock.
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