Palantir Technologies' (PLTR) customer upselling, accelerating growth, and new wins contrast with many companies that are yet to see "measurable" returns from artificial intelligence, BofA Securities analysts said in a Tuesday note.
"We continue to view Palantir as the best-in-class AI enabler, integrator, architect, and developer across peers," BofA said.
Palantir's customer throughput from initial adoption to expanding scope is accelerating, analysts said, noting that total customers and US Commercial customers rose 45% and 65%, respectively, in the quarter.
Analysts also said that contract sizes rose in the quarter, with new deals valued at over $10 million, up threefold. Deals valued at over $5 million were up 2.5 times, and overall commercial revenue was up 73% compared with a year earlier.
BofA expects the company's margins to benefit from increased internal use of AI Forward-Deployed Engineers, Artificial Intelligence Platform bootcamps, existing use-cases utilization, and expanding partnership network.
BofA increased the stock's price target to $255 from $215 and retained a buy rating.
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