We recently published a list of Jim Cramer’s Ultimate Stock Portfolio: Top 10 Recommendations. Since Palantir Technologies Inc (NYSE:PLTR) ranks 4th on the list, it deserves a deeper look.
Jim Cramer on a recent program talked about the concept of “suitability” in investing stocks, which emphasizes the importance of choosing individual stocks based on your personal context, circumstances and life goals rather than short-term market movements. Cramer recalled his days at Harvard Law School and how he would run to the library to read research reports on companies to dig up information on quality stocks week after week. When Cramer joined Goldman Sachs, an “executive” at the firm introduced him to the concept of fit, advising him never to recommend stocks to people without knowing what they want from an investment. According to Cramer, that “best semiconductor stock” may not be good for all individuals, and therefore it is necessary to know the investors’ “tolerance” and appetite for risk.
Answering a question during the program, Cramer said that technical analysis, including paying attention to RSI values, is “extremely” important to him, and he does not like to buy stocks if “their chart is bad.”
For this program we looked at some of Jim Cramer’s latest programs and picked 10 stocks that he talked about recently. These include stocks he is bullish on as well as those he recommends selling. We’ve analyzed each stock in detail to see its fundamentals and know what Wall Street believes about it. We’ve also mentioned hedge fund sentiment with each company. Why are we interested in the stocks in which hedge funds accumulate? The reason is simple: our research has shown that we can outperform the market by mimicking the top stock picks of the best hedge funds. Our quarterly newsletter strategy picks 14 small-cap and large-cap stocks each quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Palantir Technologies Inc (NYSE:PLTR)
Number of hedge fund investors: 45
Jim Cramer on a recent program again expressed his disappointment about the visibility of Palantir’s business, saying that the company is like a “giant black box”. He said it would “help” if the company would “show what they do”.
Wall Street disagrees with Cramer. Recently, BofA added Palantir to the list of best-of-breed stocks. Wedbush analyst Dan Ives said in a recent note that Palantir Technologies Inc (NYSE:PLTR) is one of the stocks that could benefit from the “AI party” just getting started. Ives counted Palantir Technologies Inc (NYSE:PLTR) among the stocks that will ride the AI wave thanks to their “massive installed bases” in both the enterprise and consumer spaces.
Wedbush’s Dan Ives called the recent selloff around Palantir Technologies Inc (NYSE:PLTR) a “golden” buying opportunity. Ives has an outperform rating and a $35 price target on Palantir Technologies Inc (NYSE:PLTR). Palantir Technologies Inc ( NYSE:PLTR ) is trading at a lofty P/E multiple of 170, which has many alarmed. However, Palantir Technologies Inc ( NYSE:PLTR ) bulls believe Palantir Technologies Inc ( NYSE:PLTR )’s consistent government contracts and AI-related growth catalysts justify this multiple. Analysts are bullish on Palantir Technologies Inc’s (NYSE:PLTR) AI Platform (AIP), which helps companies and governments make decisions based on AI technologies. In the first quarter alone, Palantir Technologies Inc (NYSE:PLTR) saw a 16% year-over-year increase in government contracts. US government revenue rose 12% year over year.
Carillon Scout Mid Cap Fund stated the following regarding Palantir Technologies Inc. (NYSE:PLTR) in its Q1 2024 investor letter:
“The main contributor to return for the quarter was Palantir Technologies Inc. (NYSE: PLTR). Sentiment improved on Palantir after it reported stronger-than-expected trading revenue from customers and free cash flow. US commercial growth was particularly encouraging, as US commercial revenue grew by a large percentage year-over-year for the fourth quarter and the number of US commercial customers grew by nearly as much. We expect Palantir to become one of the leading providers of artificial intelligence (AI) software, built on its Foundry and AIP platforms.”
Overall, Palantir Technologies Inc (NYSE:PLTR) is ranked #4 on Insider Monkey’s list titled Jim Cramer’s Ultimate Stock Portfolio: Top 10 Recommendations. While we acknowledge the potential of Palantir Technologies Inc (NYSE:PLTR), our conviction lies in the belief that AI stocks hold greater promise to deliver higher returns and to do so over a longer time frame. short. If you’re looking for an AI stock that’s more promising than Palantir Technologies Inc (NYSE:PLTR) but trades at less than 5 times its earnings, check out our report on Cheapest AI stock.
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Disclosure: None. This article was originally published on Insider Monkey.