We're Calling Up This Polarizing AI Company to the Portfolio

Symbol	Transaction Type	# Shares Traded	Recent Price $	Shares Owned After Trade	% Portfolio
PLTR	Buy	580	$79	580	1.0%

After you receive this alert, we will buy 580 shares of Palantir PLTR at or near $79. Following the trade, the Portfolio will own 580 PLTR shares, roughly 1.0% of the Portfolio.

We are starting a small position in the recent Pro Portfolio Bullpen addition Palantir with a Two rating and an $87 price target.

In our comments earlier on Tuesday, we called out the need for a catalyst to drive either the market or individual stock prices higher on a sustained basis. In the case of Palantir, there appears to be an event scheduled for Thursday, March 13 that could be its next AIPCon.

Like Apple’s AAPL WWDC or Meta’s META Meta Connect, AIPCon is an event at which Palantir announces new products and customers, and for customers to demonstrate how they use Palantir's products. Unlike WWDC and Meta Connect, Palantir had AIPCon events in March, June and September of 2024, and this is shaping up to be its first for 2025.

Since adding PLTR shares to the Bullpen last week, they, along with the market, have continued to trend lower. While the S&P 500 and the Nasdaq Composite have moved further into oversold territory on Tuesday, PLTR shares are neither oversold nor overbought with their relative strength index level near 39. The shares are approaching their 100-day moving average near $73.58, and we’d note the S&P 500 has now fallen 10%, putting it into correction territory as well.

For us, the fundamental reason for owning PLTR shares is to capture the benefits of the company’s expanding customer base and AI adoption. With Congressional approval for DOGE cuts looking increasingly likely, not to mention Elon Musk potentially needing to resume a more active role at Tesla TSLA, risk to Palantir’s federal contracts may not be as dire as previously feared. The same goes for ServiceNow NOW and Elastic ESTC.

Should Thursday’s event prove to be a catalyst for the shares, we’ll look to revisit our price target as needed. If not, we’ll look to pick up more shares closer to support levels discussed above. We will be disciplined in buying additional shares, which members should read as us not looking to chase them. While there are some sky-high price targets out there for PLTR shares (the high is $141), we recognize that even with our more disciplined approach, PLTR shares are not cheap despite the more than 35% fall. For those keeping score, our $87 price target equates to a price-to-earnings growth (PEG) ratio of 4.1x on consensus 2027 EPS of $0.70. That doesn’t consider the $5.2 billion in cash on the company’s balance sheet.

We’d also note Palantir repurchased stock in December 2024 at an average share price of $74.74, not too far off where the shares are now. With just over $935 million on its current repurchase program exiting 2024, we would not be surprised to learn the company had been buying stock when it reports its next quarterly results.

We will set our initial panic point for PLTR shares at $63, and we will review that level as the shares move higher.

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(Please note that we are looking to execute these trades at or near the share price mentioned above. Once the trade is completed, subscribers can see the trade's executed price here. Be sure to toggle the chart to sort by Purchase Date.)

At the time of publication, TheStreet Pro Portfolio was long AAPL, META, NOW and ESTC.