Shares of Palantir Technologies (NASDAQ: PLTR) and AppLovin (NASDAQ: APP) have experienced astronomical gains over the past two years, skyrocketing 925% and 1,910%, respectively. Despite their impressive runs, certain Wall Street analysts still see significant upside potential for both AI-driven companies in the coming months.
Palantir Technologies: A 65% Upside Potential?
Market Leader in AI and Decision Intelligence
Palantir Technologies has built a strong reputation in the data analytics and AI space. Its flagship platforms, Gotham and Foundry, help businesses and governments analyze vast amounts of complex data to enhance decision-making. The company’s ontology-driven software structure provides a unique competitive edge in an increasingly AI-driven market.
Strong Financial Growth
Palantir’s Q4 2024 earnings showcased accelerating momentum:
- 43% YoY customer growth, reaching 711 customers
- 36% revenue increase to $828 million
- 20% increase in existing customer spending
- 75% YoY rise in non-GAAP net income to $0.14 per share
The company expects another 36% revenue growth in Q1 2025, demonstrating continued demand for its AI platform. International Data Corporation (IDC) has already recognized Palantir as the leader in decision intelligence software, while Forrester Research ranks it among the top AI platform providers.
Analyst Projections and Market Trends
Despite a recent stock dip from its February peak of $125, Loop Capital analyst Mark Schappel has set an ambitious $141 price target, representing a 65% upside from current levels. While concerns about Pentagon budget cuts and insider selling have weighed on the stock, broader AI market tailwinds could push Palantir even higher. IDC forecasts AI software market growth of 40% annually, potentially accelerating Palantir’s revenue and earnings trajectory.
AppLovin: 140% Upside Target Despite Controversies
Revolutionizing Mobile Advertising with AI
AppLovin operates in the adtech sector, providing AI-driven solutions for digital advertisers and mobile app developers. Its key platforms, AppDiscovery and Max, leverage AI algorithms to optimize user acquisition and monetization. Additionally, AppLovin is set to exit the gaming sector through a $900 million divestiture, sharpening its focus on advertising technology.
Impressive Q4 2024 Performance
The company’s latest earnings report exceeded expectations:
- 44% YoY revenue growth to $1.4 billion
- 253% increase in GAAP net income to $0.49 per share
- 25 percentage point profit margin expansion
With its advertising business growing rapidly, AppLovin is shifting towards e-commerce adtech, a segment with substantial growth potential.
Short-Seller Allegations and Market Response
Despite its strong fundamentals, AppLovin has faced scrutiny following reports from Culper Research and Fuzzy Panda Research, alleging fraudulent activities, including data theft and illegal tracking of children’s accounts. While these claims have pressured the stock, analysts from BTIG and Piper Sandler have dismissed the accusations, viewing the sell-off as a potential buying opportunity.
CEO Adam Foroughi directly responded to the short-sellers, calling their reports “false and misleading,” emphasizing that AppLovin’s success stems from its cutting-edge AI models.
Wall Street Projections
Despite the controversy, Loop Capital analyst Rob Sanderson has raised his price target to $650, implying a 140% upside from current levels. With earnings projected to increase 45% in 2025, AppLovin’s current 57x earnings multiple appears reasonable for long-term investors willing to weather short-term volatility.
Final Thoughts
Both Palantir and AppLovin are at the forefront of AI-driven innovation, making them attractive options for investors seeking high-growth opportunities. While short-term risks exist, Wall Street analysts remain bullish, setting ambitious price targets that suggest substantial upside potential in the coming months.
