Could Investing $10,000 in Palantir Make You a Millionaire?

Palantir Technologies (PLTR 0.26%) has been around for about 20 years, but the software-as-a-service company has only recently captured the world’s attention. This is due to its use of artificial intelligence (AI) to help its customers save time and money – and how this has translated into major revenue growth.

Stock performance followed, with the stock up triple digits over the past year. And Palantir stock has received an additional boost in recent days with the announcement that it will join the S&P 500 later this month. This is a significant milestone because it shows that Palantir is one of the companies powering today’s economy.

So right now, you might be wondering if you should be buying these stocks on the move — and you might even be wondering if a sizable investment like $10,000 could make you a millionaire down the road. Let’s find out.

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Growing Palantir’s commercial customers

First, let’s consider Palantir’s path so far. The company initially generated most of its sales through contracts with governments, but in recent years its commercial business has taken off. Palantir helps its clients aggregate all their data and use it to make often game-changing decisions — and AI powers the process. This broad platform can be applied in many settings, from hospitals to restaurants and business offices. All this has helped the company grow its number of commercial customers from just 14 four years ago to 295 in the most recent quarter.

U.S. government revenue continues to outpace U.S. commercial revenue — at $278 million versus $159 million, respectively. But the growth rate of U.S. trade is more than double that of the U.S. government, at 55 percent versus 24 percent. And the number of customers and the value of transactions are growing in double and triple digits. So the commercial business is a key growth area for Palantir moving forward.

In addition, Palantir created a brilliant way to introduce customers to its Artificial Intelligence Platform (AIP), a product launched just last year. Palantir offers a bootcamp program. During these wildly popular events — Palantir hosted more than 660 in one quarter alone — potential customers see how they can apply AIP directly to their businesses. And these events often lead to new business immediately. Last quarter, Palantir closed a seven-figure deal with a wholesale insurance broker about two weeks after a bootcamp.

What stimulates growth

Palantir says AIP is generating both new customer sign-ups and offer extensions from existing customers in the U.S. commercial business. The technology company also has a global presence, and overall government and commercial revenue, including international business, has advanced by double digits in recent quarters.

All this momentum helped Palantir report a record quarterly profit of $134 million in its most recent period. And the company’s outlook for the rest of the year is bright, with GAAP net income expectations each quarter and increases in revenue guidance. In fact, Palantir expects US commercial revenue to grow as much as 47% for the full year.

Palantir’s growth to date and the trends we’re seeing in AIP and commercial revenue are reasons to be optimistic about the company — and this is set against the backdrop of a high-growth AI market, forecast to reach over 1 trillion dollars. to 2030. Analysts are predicting an 85% compound annual growth rate for Palantir over the next five years, so we’re in the early days of the company’s 20-year growth history.

From $10,000 to $1 million?

Given that potential, Palantir stock could have a lot further to go — even after recent gains. But could investing $10,000 in Palantir make you a millionaire? I think this is unlikely. Even if Palantir stock went up by 10, your investment would be worth $100,000 — a great result, but far from the $1 million mark.

But that doesn’t mean you should turn your back on Palantir. Generally, one stock won’t make you a millionaire – and it’s risky to put all your eggs in one basket and rely on one player. Instead, it is a better idea to invest in several solid companies for the long term. In this context, I think Palantir can help you become a millionaire over time and that’s why it’s a top stock to add to your portfolio now.