Rosenblatt Reiterates Palantir at Buy, $225.00 Price Target After Company Visit

Rosenblatt reiterated its Buy rating and $225.00 price target on Palantir following a visit with management and a call with implementation partner FoxTrot.

Summary

We visited with the Palantir CFO David Glazer, Chief Architect Akshay Krishnaswamy, and Head of Strategic Initiatives Cary Li at their New York offices yesterday afternoon and held a call with a key Palantir implementation partner FoxTrot today.

The two events combine to give us increased conviction in both our recently raised $225 target and our long term view that PLTR can join the $1T+ market cap club over a five-year period ($415 target).

The AIP/Foundry offering is an arbiter and optimizer of multiple LLMs and MLs, and we see the likelihood of a working AIP/Ontology/Foundry alternative being assembled from piece parts or a future AI-conjured solution as unlikely over the investable time horizon.

The call with Chris Willis of FoxTrot today suggests that business momentum for Palantir remains strong, with their business set to at least triple this year.

With PLTR now down 24% YTD vs. the IGV down 13% and the NTM PE on the name down to ~1x their growth rate (80x), we are reiterating our Buy on PLTR and $225 price target.

A Demo of Palantir Software Gave Us More Conviction that LLMs Alone Cannot Compete… Palantir Chief Architect Akshay Krishnaswamy gave us a demo of an enterprise’s supply chain mapped onto Ontology, Foundry, and AIP during our visit to Palantir’s New York office.

The level of detail and view into the way enterprise objects like plants, suppliers, products, and customers connect to their data sources and are governed by business logic was impressive.

Overlaid onto this is AIP, which uses one–or multiple–LLM-instantiated agents to route work through the system.

Palantir has visibility into the AI prompts that are most likely to produce the most accurate routes and responses, and which LLMs are best suited to which tasks.

Token costs are optimized as well–a customer was able to save six figures per week by choosing the most economical LLM for a workload.

Additionally, even if an LLM company were able to “copy” Palantir’s solution, it is hard to see how they would be considered an objective arbiter of competitors’ tokens.

…and that Palantir’s Solutions Can Evolve to Be (and in a Few Cases Are) the De Facto Enterprise Operating System. Once a business’ key business processes, logic, applications, and data are mapped into the Palantir solution, agentic AI can be used to maximum effect.

Users are given an opportunity to review agentic recommendations and see how it reached a result and this feedback is used to improve the implementation.

Via the company’s genesis as a solution provider for the U.S. defense department and other agencies, security and governance controls are deeply embedded in the fabric of the solution.

From what we saw, AIP/Foundry/Ontology comes the closest to creating a true digital twin of an enterprise and could really serve as the operating system of a modern enterprise.

We think there are few enterprises that have come close using their solutions in this way: publicly traded Airbus, Lear, and BP are likely candidates.

Additionally, Our Expert Call with Foxtrot Suggests Business Momentum Continues… Our expert call with Chris Willis, a certified Palantir Partner and VP of business development at Foxtrot Services and ex-Palantirian gives us further conviction that demand for Palantir solutions remains strong.

Chris characterized demand as “pretty insatiable,” with the main constraint being talent supply, not customer demand.

They are “hiring and growing as fast as we can.” He noted that Foxtrot is tripling this year and if they close on a rich pipeline of government business, they could grow 4x-5x over the next couple of years.

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