PLTR - More Deals Should Lead to More Gains for Palantir
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When I issued a bullish call on Palantir Technologies (NYSE:PLTR) in early January, not very many people were talking about the company. A lot has changed since then, and lately there’s been much more buzz about PLTR stock.
Perhaps that’s because the stock has become a target of interest among some Reddit and Robinhood traders. Yet, I don’t see that as a main reason to own the shares.
If you’re going to buy and hold PLTR stock, it should be because you believe in the future of the company. At the very least, investors should envision strong growth in the data analytics and security field generally.
Palantir has been quite busy in 2021 so far, and that’s a good thing. Keeping track of the company’s activities, and particularly the value-added deals, should help motivate investors to stay the course.
A Closer Look at PLTR Stock
While it might seem brand-new to some traders, PLTR stock has been around for a little while. In fact, the stock started trading on the New York Stock Exchange on Sept. 30, 2020 via a direct listing.
During the first month, the bulls struggled to get the share price above the $10 level. Starting in November, however, the stock started to show signs of life.
On Jan. 27, 2021, PLTR stock reached a 52-week high of $45. This was followed by a cooling-off period, though, as the share priced retraced back to the $24 area in February.
Over the next couple of months and through the end of April, the stock basically just went sideways. Perhaps the market is waiting for a catalyst.
In reality, however, there are plenty of positive developments that ought to boost the spirits of PLTR stock holders.
Big Government Contracts
Palantir is known for working closely with governments to enhance their data security.
As a big-data mining company, Palantir has had clients like the Central Intelligence Agency (CIA), the Department of Defense, the Food and Drug Administration (FDA) and the United Kingdom’s National Health Service.
Plus, the Army Vantage data analytics program reaffirmed its partnership with Palantir with an agreement valued at $113.8 million for the year.
Not only that, but Palantir secured a $44.4 million contract from the FDA. Reportedly, Palantir’s role will be to assist the FDA with drug reviews.
Now, we can add the National Nuclear Security Administration to the list. That’s an agency within the U.S. Department of Energy that enhances national security through the military application of nuclear science.
According to a press release, Palantir was selected for a five-year, $89.9 million contract to build out the Safety Analytics, Forecasting, and Evaluation Reporting (SAFER) project.
For this project, Palantir will “configure a common operating picture that will integrate data and allow the NNSA to measure the health of safety programs across the organization and provide timely insights into data.”
Serving the Private Sector
Acquiring government clients like the NNSA is great for Palantir and its stakeholders. Yet, the company is also collaborating with businesses in the private sector.
In this area, Palantir’s been so busy that I could write an entire book on what the company’s been up to. Instead, I’ll just give you the bullet points.
Palantir has recently established or renewed partnerships with:
- Ringier AG to “accelerate its shift to a digital-first media company”
- Faurecia (OTCMKTS:FURCF) to “gain further insight into its data across the company, from manufacturing to purchasing, from engineering to finances”
- 3M (NYSE:MMM) to support that company’s digital transformation
- IBM (NYSE:IBM) to develop artificial-intelligence-enabled data solutions for businesses
I could keep going, but you get the idea.
The point is that Palantir is working with some big names in the private sector. Thus, the company is drawing business from a diverse array of clients, and should continue to generate strong revenues for a long time.
The Bottom Line
It’s not a bad thing at all that Palantir is making deals left and right. If anything, the shareholders should celebrate this.
And indeed, I expect that PLTR stockholders will be celebrating as substantial gains should be coming, sooner or later.
On the date of publication, David Moadel did not have (either directly or indirectly) any positions in the securities mentioned in this article.
David Moadel has provided compelling content — and crossed the occasional line — on behalf of Crush the Street, Market Realist, TalkMarkets, Finom Group, Benzinga, and (of course) InvestorPlace.com. He also serves as the chief analyst and market researcher for Portfolio Wealth Global and hosts the popular financial YouTube channel Looking at the Markets.
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