TLDR
- Palantir Technologies Spain announced a partnership with EYSA to enhance mobility application development
- Palantir’s stock recently tumbled due to concerns about potential Department of Defense budget cuts
- Despite government contract concerns, Palantir’s customer count jumped to 711 by the end of 2024, nearly double compared to 2023
- Veteran trader Stephen Guilfoyle named Palantir as his top stock pick for both 2024 and 2025
- Analysts have mixed views, with Jefferies maintaining an underperform rating while Wedbush affirmed an outperform rating with a $120 price target
Palantir Technologies Inc. (PLTR), a leading provider of artificial intelligence systems, has been making waves in the investment world with its recent partnership announcement and stock price volatility.
On March 6, Palantir Technologies Spain announced a new partnership with EYSA, a leader in comprehensive sustainable mobility solutions.
This collaboration aims to enhance mobility application development after a successful pilot test through a multi-week Palantir bootcamp.
During the pilot, EYSA confirmed the success of Palantir’s Foundry and AIP platforms in addressing complex questions, planning scenarios, and accelerating the development of new mobility applications.
This integration will allow all areas and businesses to work autonomously in a private and secure environment that effectively utilizes data and artificial intelligence.
The alliance is expected to drive technological transformation in the mobility sector in Spain and beyond.
Meanwhile, Palantir’s stock has experienced recent turbulence. The shares tumbled following news that Tesla CEO Elon Musk and the Department of Government Efficiency were looking to reduce federal spending, including at the Department of Defense.
This news had a direct impact on Palantir since approximately 50% to 60% of its revenue comes from government contracts, with most stemming from the U.S. government and particularly the Pentagon.
Adding to these concerns, Defense Secretary Pete Hegseth reportedly directed the DoD to develop plans to cut 8% from the defense budget annually over the next five years.
Jefferies analyst Brent Thill maintained an underperform rating on Palantir shares. Thill noted on March 4 that CEO Alex Karp had sold shares valued at $45 million in the prior two weeks after selling more than $2 billion of shares in 2024.
Although Karp has sold 21% of his overall stake, his current trading plan allows for another roughly 17 million shares to be sold through September 2025.
Analyst gives outperform rating with a $120 price target
On the positive side, Wedbush affirmed an outperform rating with a $120 price target on March 4. The investment firm stated that “the efficiency focus of the Doge initiatives could be a major coup for the likes of Palantir over the next year as its unique software value proposition plays perfectly into this broader Beltway theme under [President Donald Trump] and Musk.”
William Blair upgraded Palantir to market perform from underperform on March 5, following the 33% “Doge-driven selloff” in the shares from $125 to $84 over a three-week period.
While noting that Palantir’s valuation is “still frothy” with potential downside risk, the firm acknowledged that “there have been positive developments.”
Despite concerns about government exposure, Palantir has been expanding its customer base. The company’s software is used across 90 industries, with the government sector accounting for 55% of revenue last year and the commercial sector making up the balance.
Palantir’s customer count jumped to 711 by the end of 2024, up from 497 at the end of 2023 – nearly doubling in a single year.
In November 2023, CEO Alex Karp announced the company had earned “the most profit in our company’s 20-year history,” making Palantir eligible for inclusion in the S&P 500, a milestone they had been working toward.
The company did indeed join the S&P 500 last year, marking a major achievement in its growth journey.
Veteran trader bullish on Palantir
Veteran trader Stephen Guilfoyle has been particularly bullish on Palantir. He named it as his top stock pick for 2024, choosing it over tech giants like Alphabet and Microsoft.
In an unprecedented move, Guilfoyle selected Palantir as his stock pick again for 2025, declaring “My children and grandchildren will hold equity in PLTR.”
Guilfoyle has reportedly used the recent weakness in Palantir’s stock as an opportunity to buy more shares on March 6, and indicated he might add even more depending on market conditions.
Some analysts are noting signs of greater pushback on the Department of Government Efficiency’s cost-cutting efforts, with U.S. Senate Republicans pushing for Congress to codify spending cuts.
The Supreme Court’s recent decision not to let Trump withhold certain payments to foreign aid organizations may not bode well for the White House’s hopes of cutting spending allocated by Congress.
While the government has inefficiencies to address, congressional approval over proposed cuts increases the odds of smaller reductions than previously stated, which could benefit government contractors like Palantir.
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