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Palantir (PLTR) stock has been rattled in recent weeks as tariffs drive fears of a recession and continue to weigh on U.S. tech stocks.
Plus, investors are concerned that federal spending cuts could hurt PLTR’s business as well.
But a William Blair analyst recommends buying Palantir stock on recent weakness since it’s positioned for significant upside in the near term.
PLTR shares are currently down more than 35% versus their year-to-date high set in mid-February.
Why Is William Blair Bullish on Palantir Stock?
President Donald Trump’s administration has recently directed the Pentagon to reallocate about $50 billion to advanced military technologies, including drones.
According to William Blair analyst Louie DiPalma, that could prove to be a tailwind for Palantir as its software is what powers those military technologies.
DiPalma favors investing in PLTR also because the U.S. Army could soon announce a new contract for its Next-Generation Command and Control (NGC2) program.
Additionally, the Army has recently indicated plans of continuing with the existing Army Vantage platform, which is powered by Palantir.
Put together, these developments suggest the PLTR share price could rip higher in coming weeks, DiPalma argued in a recent note.
PLTR Doesn’t Have Revenue Exposure to China
DiPalma recommends buying Palantir stock amidst ongoing volatility also because it hardly has any revenue exposure to China.
Beijing has already announced a 34% retaliatory tariff on American products. But that doesn’t mean much for PLTR as more than half of its revenue comes from the U.S. Palantir has historically avoided doing business with China due to data privacy and security concerns.
That’s why the company’s management offered better-than-expected guidance in February. Palantir sees its revenue coming in at $3.75 billion this year – well ahead of $3.52 billion that experts had forecast.
Wall Street Is Cautiously Positive on Palantir
Despite macroeconomic challenges and an uncertain environment, other analysts seem to agree with Louie DiPalma on Palantir stock.
The mean target on PLTR shares currently sits at about $84.
While that doesn’t suggest a swift recovery for shares to their peak in mid-February, the price target, nonetheless, indicates potential for about a 10% gain from current levels.
