Palantir Technologies has entered into a partnership with IBM to build AI-driven applications for businesses. As part of the collaboration, IBM’s hybrid cloud data platform, which provides artificial intelligence (AI) solutions for businesses will be integrated with Palantir’s operations platform.
The new product, Palantir (PLTR) for IBM Cloud Pak for Data is expected to be available by March of this year. Shares of Palantir jumped 5.8% while IBM’s shares rose 1.5% at the close on Feb. 8.
The partnership is targeted towards businesses, who need to analyze and access vast amounts of data including retail businesses, financial services, healthcare, manufacturing and telecommunications.
The new product will use Palantir Foundry to build an information architecture that will use AI for data-driven decision making and automation of tasks and processes. As a result of this partnership, Palantir will adopt Red Hat OpenShift – IBM’s (IBM) open-source hybrid cloud platform.
Palantir’s CEO, Alex Karp said, “Our partnership with IBM combines our forces to put our joint solution into the hands of the institutions and people who need it most and will propel the world’s most critical institutions into an unprecedented new digital age.” (See Palantir stock analysis on TipRanks)
Following the partnership announcement, William Blair analyst Kamil Mielczarek reiterated a Hold on PLTR stock. Mielczarek commented, “While we believe AI will play a critical role over the long term in maximizing the value that companies get out of their data, broad applicability of such technology is still in its early stages. Palantir’s adoption of Red Hat OpenShift could make it easier to deploy and maintain Palantir’s platforms in modern containerized environments.”
The rest of the Street is cautiously bearish about the stock with a Moderate Sell consensus rating. That’s based on 1 analyst recommending a Buy, 2 analysts suggesting a Hold, and 3 analysts saying Sell. The average analyst price target of $18.80 implies 47.9% downside potential to current levels.
On the TipRanks Smart Score system, PLTR scores a 6 out of 10, indicating that the stock is likely to perform in line with market averages.