Why Bank of America Is Bullish on Palantir

The U.S. commercial business is partly being reflected right now. But actually, if you look at some of the bigger contracts that they secured, they don't call it a backlog. But there is a long way to go and there's a big opportunity. And I was reading your note. That's why you've upgraded a lot of your estimates. Yes. The U.S. commercial strength is just a result of what we have been discussing in the past. Pantera's position at the right place, at the right timing to benefit from actually being able to operationalize all this high momentum and all these high demand. And U.S. is actually embracing that with the size of the contracts they are seeing is also very, very amazing. If you look at the trailing 12 month average, um, spending per U.S. customer, that is top like 67%. And it's not just new customers that are ramping faster, but also legacy customers that have been using this orchestration or ontology for a while that are ambitious, and they want to keep incorporating the benefits of AI into their businesses, right? I always remind myself, what is Palantir do? Palantir makes AI powered software that helps companies and governments either analyze their data or make decisions on their data, or automate data related processes. Right? Simple as that. But the takeaway in the story that Alex Carbon, Palantir want to tell is owning the means of production in the AI context. Are they showing evidence that they're helping customers do that? Well, actually, when you made other conferences with customers, customers are really happy about it. And the reality is that they have tried they have tried to just implemented themselves. And it's not that easy. Punjab has been orchestrating not only this data analytics platform, but how the decision making actually worked with that. And all these human interaction with I. It's really hard to have that. Digitalize and balancer has been doing that for decades. So customers are happy about it and customers are actually leaning into that opportunity. Palantir's U.S. growth 115%, its international revenues growing at 33%. But Europe is a story that right, Europe's much slower and talented, continues to kind of express open frustration about that. What's going on in that market? I think what happened in Europe particularly, I'm going to speak about what we do. We hear from the aerospace and defense industry, and we're seeing that in a lot of Ukraine. There is this urge for European countries to do undependable much on U.S. technologies. They don't need to like they need to actually have domestic solutions. So is the two phases soft sovereignty in my way, that is like actually trapping in the middle because while volunteer actually gives a really good sovereign I platform for you to own your IP, for you to be able to benefit from both like Open models and frontier models, and at least have like all those learnings for yourself on proprietary data on the right and of sovereignty. They are a really outspoken American company. So that's part of the noise. And. Mariana, you talk about part of Palantir's secret sauce being how they price, they price that they're offering on measurable outcomes. In other words, like, here's what we actually did for you. Not now. Pay us this. How unique is that in this space? I think that's starting to be more popular. And the FDA, these and the ontologies are also getting more popular on other so for companies approach and go to market strategy. The difference is Palantir actually partners with their customers. They care about their problems. They care about their mission, and this is how they price their outcomes and they price their solutions. And this is why they are able to have, well, like 55% cash margins, because as they produce profits for their customers, they can also produce them for themselves. I just real quick ontology is basically the digital model of how a company's business works in the real world. Um, really, really quick. Your price tag is two, five, five is about $100 to go. This is a turning point for them. Uh, I do think Palante is growing into that valuation. Um, it's still like down versus last November peaks. And if you look at the estimates, you continue to actually execute not only in line with expectations, but even faster than expected. So I think that boats like more than the market D rating on general D rating. And also I think countries outgrowing that.