A veteran trader who correctly predicted Palantir’s rally reveals a new price target

Alex Karp made the list.

CEO and co-founder of Palantir Technologies (PLTR) was recently added to the Forbes 400, a list published by Forbes magazine of the 400 wealthiest US citizens ranked by net worth who own assets in the US

Don’t miss the move: Subscribe to TheStreet’s free daily newsletter

Forbes said that despite needing more money than ever to make the annual list, which Malcolm Forbes started in 1982, “23 billionaires managed to make their way into the ranks this year year”.

“Palantir’s meteoric rise has earned CEO Alex Karp a first-time spot on the Forbes 400 list of richest Americans, worth about $3.6 billion, thanks to his stake in Palantir and about $1 billion in cash from September 1 stock sales. the day we finalized the net worth for our list,” Forbes said.

Related: Nvidia CEO bombshell raises bar for stock

The publication raised questions about the data analytics company’s valuation. He noted that only five of the 20 analysts covering Palantir give the group a “buy” rating, with the rest split between hold and sell ratings.

Forbes reporter Phoebe Liu said Karp’s addition to the list and Palantir’s overvaluation show that what he and his company stand for — Western values, American defense and artificial intelligence — are particularly relevant in the economic, cultural and geopolitical landscape of today.

Alex Karp, chief executive of Palantir Technologies Inc., is riding a wave of demand for AI.

Bloomberg/Getty Images

Analyst says he’s “more bullish” on Palantir

“It’s worth watching what happens with the ever-controversial, ever-secretive (despite being publicly traded!) firm in the coming months and years,” Liu said.

Karp, who appeared on “Real Time with Bill Maher” last month, is an eccentric leader who wears brightly colored tracksuits, practices martial arts, keeps Tai chi swords and can solve a Rubik’s cube in less than 3 minutes, according to a MSN profile.

Related: Palantir shares rise on huge S&P 500 decision

After the TV interview, TheStreet Pro analyst Ed Ponsi wondered if Karp was the next “rock star CEO” and noted that the executive “turned in a brilliant performance, even as he struggled to coherently explain what his company actually does.”

“Never mind,” said Ponsi. “This was Karp’s moment on the big stage. Like Jimi Hendrix at Monterey or Bob Dylan at Newport, Karp just entered the mainstream consciousness.”

The company has received support from the CIA’s In-Q-Tel investment and performs contract work for government agencies such as the Department of Defense, the FBI and the Danish National Police.

Palantir’s sales are largely driven by its work to assist the US government in its counterterrorism efforts. The data analytics software provider has also expanded into data management, interpretation and reporting for large companies.

Karp and his company joined another list recently when Palantir, which went public in 2020, joined the S&P 500, replacing the mighty American Airlines. (AAL) .

On September 26, Wedbush analyst Daniel Ives raised the company’s price target for Palantir to $45 from $38, while maintaining an outperform rating on the stock, according to The Fly.

Ives said he is “more optimistic” about Palantir going forward, noting that his recent channel checks indicated more and more enterprises are having strategic discussions about how they will deploy the company’s AI platform in 2025.

The analyst said the increased price target reflects greater confidence in Palantir’s AI strategy. He added that he sees this as a clear “game changer” for the Palantir story as AI use cases begin to take hold over the next 12 to 18 months.

The veteran trader looks ahead to the upcoming earnings report

The company is “in a prime place to continue to expand its pipeline/hill stream while providing more use cases that will come forward to solve critical problems in various industries,” Ives said.

Related: Goldman Sachs strategist reveals surprising stock market predictions

Palantir shares are up 126% year-to-date, and the stock took a hit recently when co-founder Peter Thiel, whom Karp met at Stanford Law School, sold 12.412 million Palantir shares at an average price of $36.85 per September action. 27 to October 1 under trading plan 10b5-1.

More AI actions:

• Apple shares slide as high stakes iPhone 16 sputters
• Analyst Revises Price Target on Meta Shares as Parent Facebook Raises AI Spending
• Analyst looks at BlackRock’s stock valuation after AI partnership with Microsoft

The shares were sold through Rivendell 7 LLC, which now owns about 34.26 million shares of Palantir.

“This was all planned selling and who could blame him after the run the stock has had?” TheStreet Pro’s Stephen Guilfoyle wrote on October 3rd. “It appears that Thiel has not sold any of his voting shares. He, board member Stephen Cohen and CEO Alex Karp still control the company.”

Guilfoyle correctly predicted Palantir’s stock growth, making it a top pick when it traded below $10 per share and continually recommending it during its rise. He correctly predicted that Palantir’s share price could eventually reach $36.

The veteran trader, who has been trading stocks since the 1980s when he worked on the New York Stock Exchange, noted that the company entered the S&P 500 hand in hand with Dell Technologies. (della) .

“Dell is down 10.6% from its peak after the addition,” Guilfoyle said. “I suggested that PLTR might suffer a similar fate after the addition, but so far, the stock has moved more sideways than down.”

Palantir and oil and gas producer APA Corp. (WATER) recently announced a multi-year, multi-million dollar extension to their enterprise agreement originally signed in 2021.

The agreement builds on work done across APA’s global portfolio over the past three years and introduces new AI capabilities with Palantir’s AI platform software.

“We haven’t had a clear target since the $36 level was taken and held,” Guilfoyle said.

That has changed. Guilfoyle unveiled a new $48 price target on Palantir this week.

The company is expected to report third-quarter results in November, and analysts are looking for adjusted earnings of 9 cents per share on revenue of $703.7 million.

“If that’s really how the cookies are falling, those numbers would be good for 29 percent earnings growth on 26 percent revenue growth,” Guilfoyle said. “Of the 11 sell-side analysts I see post-sell estimates for Palantir, all 11 have raised their estimates since the start of the third quarter.”

Related: The 10 Best Investing Books According to Our Stock Market Pros