By Sam Boughedda
On Thursday, Goldman Sachs analyst Gabriela Borges initiated Palantir Technologies (NYSE:PLTR) with a Neutral rating and a $10 price target.
Goldman views Palantir as "uniquely positioned" amongst data analytics vendors, given its holistic solutions encompassing data preparation, data modeling, and forward-deployed engineers.
Borges said they are also constructive on "Palantir's longer-term opportunity to succeed in the enterprise, as it continues to scale its commercial sales force (from 16 in 2020 to 200 in 2022) and given recent product updates to allow more dynamic implementations."
However, they initiated a Neutral rating on the stock due to limited visibility into the cadence of the business in any given quarter, especially in a weaker macro environment where enterprises may be reluctant to embark on larger digital transformation projects.
"Our price target reflects this limited visibility by benchmarking to both SaaS comparables and defense/government technology comparables; we also consider Palantir’s outsized stock-based compensation (33% of sales vs. peers at 15%), but best-in-class financial profile (60 on the 'rule of 40'). We look for improving visibility into government or enterprise to become more constructive on the stock."