Nvidia has been the leading stock of the artificial intelligence boom. But lesser-known AI players have been proving their mettle. Some of these have strong partnerships with the defense and government agencies while also growing their portfolio in other industries.
While Nvidia is the obvious choice on the chip side of the AI revolution, enterprise software company Palantir has been making its mark as well. The stock is in a undefined base with a buy point at 27.50, according to IBD MarketSurge.
Palantir stock is also trying to clear an entry around 24 using a trend line that starts with the high on March 8. Palantir is today's selection for IBD 50 Stocks To Watch.
Sales growth has been steady over the past eight quarters. First-quarter sales grew 21% to $634.3 million.
Q1 earnings of 8 cents per share were 60% higher than the prior year. While growth has slowed from earlier quarters, keep in mind that the company's EPS have been in single digits the past several quarters, which can exaggerate percentages.
For the current quarter, the AI play gave a revenue outlook of $651 million at the midpoint. Analysts polled by FactSet expect slightly higher revenue of $653.5 million. That would be a 23% year-over-year increase.
For the full year, Palantir raised its revenue guidance to $2.68 billion.
Palantir stock has a nearly ideal Composite Rating of 97 and EPS Rating of 95. Its Relative Strength Rating of 90 also shows the stock has outperformed most stocks in the IBD database.
Palantir ranks second in the enterprise software group. The company offers software for a range of industries, including energy, defense, auto and health care to address a range of business needs such as optimizing workflow, supply chain management, and software security.
Mutual funds own 26% of Palantir stock. More funds have bought the stock over the past seven quarters. The stock has been under accumulation in recent weeks, earning it an Accumulation/Distribution Rating of B.
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