Palantir Stock Was Downgraded by Morgan Stanley Last Week. Its Stock Has Surged Since Then.
Palantir Technologies stock is showing no sign of slowing down, despite an analyst downgrade last week. The shares have soared about 26% since Palantir posted its first quarterly earnings report as a public company a week ago.
The gains continued on Thursday, with Palantir stock (ticker: PLTR) climbing 3.3% to $18.49, while the S&P 500 index was down 0.2%.
Palantir offers software tools that companies, nonprofits, and government agencies use to analyze data sets. The company has been the subject of some public scrutiny by activist groups for working with U.S. intelligence agencies.
Last week, Morgan Stanley analyst Stanley Weiss lowered his rating on the stock to Equal Weight from Overweight, though he raised his price target to $15 from $13. Weiss pointed to the stock’s rally since the tech firm went public on Sept. 30 at $10 a share. He argued the risk-reward was balanced, with the stock then trading at 22 times on an enterprise value to revenue basis.
He argued that Palantir’s “platforms address one of the most common problems facing government agencies and commercial enterprises today—connecting, integrating and organizing data hidden within siloed, disparate legacy systems to make better decisions, drive better outcomes and build better application.”
Nonetheless, Palantir stock has rallied this week after major hedge funds—including Dan Loeb’s Third Point Management and Steve Cohen’s Point72 Asset Management—recently disclosed holdings of Palantir. Third Point disclosed that it held 2.4 million shares, while Point72 said it acquired 29.9 million shares during the third quarter.
Last week, George Soros’ Soros Fund Management also disclosed it owned about 18.46 million shares, but the firm said in a statement that the holding came from an investment made in 2012 and that it planned to sell when legally allowed. SFM said it doesn’t approve of the company’s business practices, pointing to concerns about big data.
“SFM has sold all shares in the company that it isn’t legally or contractually obliged to hold and will continue to sell shares as permitted,” the statement said.
Palantir has said it won’t do business with “customers or governments” whose positions or actions aren’t consistent with “Western liberal democracy and its strategic allies.”
Write to Connor Smith at [email protected]
