HSBC Analyst Initiates Coverage on Palantir with Neutral Rating

By Don Francis, Editor
September 16, 2023 12:56 PM UTC
HSBC Analyst Initiates Coverage on Palantir with Neutral Rating

HSBC's Stephen Bersey initiated their coverage on Palantir (NYSE: PLTR) with a Hold rating and a $16 price target. Assuming coverage on 10 U.S. tech names, Bersey noted that the U.S. tech sector is experiencing tailwinds that will ramp up operating performance for some companies, but not all. HSBC acknowledges "the promise of AI," but cautions that the timing remains uncertain, the analyst reported, adding that demand for cloud and digital transformation "remains strong."

Bersey's rating of Hold suggests a neutral stance on the stock, indicating that they believe the stock price will remain relatively stable in the near term. However, it is important to note that analyst ratings are subjective opinions and should not be the sole basis for making investment decisions.

According to the report, Bersey prefers companies that are "at critical stages of their operations with leveraged operating models poised to deliver better operating performances than peers." This implies that Bersey is looking for companies that have the potential for significant growth and profitability.

In terms of PLTR's current analyst ratings, 20% of top-rated analysts rate the stock as a Strong Buy or Buy, while 40% see it as a Hold. The remaining 40% either recommend or strongly recommend selling the stock. These ratings indicate a mixed sentiment among analysts regarding the future prospects of Palantir.

It is worth noting that since PLTR's last quarterly report on June 30, 2023, the stock price has remained unchanged. However, on a year-over-year basis, the stock has witnessed a significant growth of 91.4%. During the same period, PLTR has outperformed the S&P 500, which has seen a gain of 14.1%. These numbers suggest that Palantir has performed well in the market, but it is important to consider the overall market conditions and the company's specific growth prospects.

HSBC analyst Stephen Bersey, who initiated the coverage on Palantir, is ranked by WallStreetZen in the bottom 14% out of 4,329 Wall Street analysts. With an average return of -4.1% and a 25% win rate, Bersey specializes in the Communication Services, Real Estate, and Technology sectors. While this ranking may raise concerns for some investors, it is important to remember that individual analyst performance can vary and should not be the sole factor in making investment decisions.

Palantir Technologies Inc. is a company that builds and deploys software platforms to the intelligence community in the U.S. for counterterrorism investigations and operations. Their software platform, Palantir Gotham, enables users to identify patterns hidden deep within datasets, ranging from signals intelligence sources to reports from confidential informants. The platform also facilitates the handoff from analysts to operational users, aiding in planning and executing responses to identified threats. Founded in 2003, Palantir Technologies is headquartered in Denver, CO.

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