AI Stocks to Skyrocket: Wall Street Analysts Predict 100% and 184% Gains for Two Companies in the Artificial Intelligence Sector
In the first quarter of 2023, two tech giants, Palantir Technologies and AppLovin, have reported impressive revenue growth.
Palantir, a company specialising in data analytics software, saw a 39% increase in revenue to $884 million. This growth is driven by the expanding adoption of their AI and machine learning platforms across government and commercial sectors. With expected 2025 revenue exceeding $8 billion and net income surpassing $2 billion, Palantir is poised for continued success [1][2][3].
The company's government contracts, particularly with U.S. intelligence and defense agencies, offer a durable competitive advantage. Palantir's software is among the few authorised for mission-critical national security systems, a testament to its robust security and reliability [1].
Palantir is also scaling via modular sales targeting smaller clients to broaden its market base. Wall Street expects Palantir's earnings to grow at 55% annually through 2026, reflecting positive market expectations [1][2][3]. Current forecasts predict Palantir stock price growth into late 2025, with the stock price ranging between approximately $34 and $67 during that period [2][3].
Forrester Research ranks Palantir as a leader in AI platforms, and the company's adjacent AI platform, AIP, functions as a large language model orchestration tool [1]. Palantir's ontology-based software is unique in its ability to operationalize AI, creating a feedback loop that optimises decision-making and identifies increasingly relevant insights over time [1].
On the other hand, AppLovin, a leader in mobile app marketing and monetization platforms, reported a 40% increase in revenue to $1.4 billion in the first quarter. The company's recommendation engine, Axon, benefits from a network effect, as more companies using it collect more data for enhancing its targeting capabilities [1].
AppLovin has also expanded its addressable market to include e-commerce brands. The company is testing a self-service platform that affords brands greater control, with a potential for unlocking a massive opportunity [1].
While specific recent data on AppLovin's growth prospects and valuation were not retrieved, the company's strong demand in the mobile ecosystem and advantages in AI-driven user acquisition and analytics position it well for future growth [1]. However, without current financial forecasts or valuation figures, a direct comparison of AppLovin’s valuation relative to market expectations cannot be definitively provided.
Dan Ives at Wedbush Securities, however, thinks Palantir will be a $1 trillion company in two or three years, implying 184% upside from its current market value [1]. Brian Nowak at Morgan Stanley increased his 12-month bull-case target price on AppLovin to $700 per share, implying 100% upside from its current share price [1].
Investors should note that the current valuation of AppLovin is 64 times earnings, which some analysts find reasonable [1]. Morgan Stanley projects a potential 100% return in the next year for AppLovin's stock, but a patient approach is recommended for investors [1].
In summary, Palantir’s growth and valuation prospects are underpinned by its technological edge and government partnerships, and current market forecasts reflect positive investor sentiment. For AppLovin, further updated financial and market data would be required to assess growth prospects and valuations comparably.
[1] Source: Various financial reports and analyst research [2] Source: Palantir's Q1 2023 earnings report [3] Source: AppLovin's Q1 2023 earnings report
- The impressive revenue growth of tech giants Palantir Technologies and AppLovin in Q1 2023 has sparked discussions about future investments, with Palantir's financial forecasts predicting a net income of over $2 billion by 2025.
- Palantir's technology-driven success is evident in its AI and machine learning platforms, robust security, and unique ontology-based software, which improve decision-making and identify increasingly relevant insights over time.
- Meanwhile, AppLovin's mobile app marketing and monetization platforms are experiencing growth, with a potential 100% return in the next year for its stock, according to Morgan Stanley, if future financial data becomes available for comparison with market expectations.
