Stock price doubled this year... The company that rose to the 20th largest U.S. market cap with AI analytics [Kang Kyung-joo's TechX]

<TechX30>Palantir counts US Department of Defense, CIA, FBI among its clients

Artificial intelligence (AI) software (SW) company Palantir has made it into the top 20 U.S. companies by market capitalization. Supported by AI technology and major contracts with the U.S. government, its stock price has soared more than 100% just this year.

According to the New York Stock Exchange on the 26th (local time), Palantir's share price closed at $158.80 on the 25th, up 2.54% from the previous day. This marked an all-time high closing price, surpassing the previous day's record of $154.86. Its market capitalization surged to $374.75 billion, overtaking Bank of America and the largest U.S. interior retailer, Home Depot, to rank 20th by market cap. In May, it surpassed technology giants like Salesforce, IBM, and Cisco to rank 10th among tech companies, and it has now joined the ranks of the 20 most valuable companies in the U.S.

Founded in 2003 by Peter Thiel, CEO Alex Karp, and others, Palantir provides an SW platform for analyzing and visualizing vast amounts of data. This enables organizations to easily understand complex data and make decisions, forming the foundation of its business model. Palantir supplies its AI-integrated platform to the U.S. Department of Defense, collaborates with intelligence agencies such as the CIA and FBI, and its solutions are widely used in security, defense, and cybersecurity sectors.

As a result, its share, which was $75.63 at the end of last year, has climbed over 100% just this year. In the most recent quarter, U.S. government revenue jumped 45% to $330 million, while total revenue grew 39% to $884 million. Next quarter's earnings will be announced on the 4th of next month. Some concerns about Palantir's high valuation have also arisen. Looking at the price-earnings ratio (PER), a typical valuation metric, Palantir trades at 273 times its projected net earnings. Among the top 20 U.S. companies by market cap, only Tesla (175 times) and Palantir have triple-digit PERs.

Palantir's annual revenue is about $3.1 billion, the lowest among the top 20 market cap companies. The closest is Mastercard, whose annual revenue is over nine times that of Palantir, at about $29 billion. Nonetheless, experts see further upside potential for Palantir's share price. U.S. investment bank Piper Sandler set Palantir's target price at $175 and gave an 'overweight' investment rating, suggesting there is room for an 11% further rise.

Reporter Kang Kyung-joo qurasoha@hankyung.com