Palantir (PLTR) is climbing today after the firm was upgraded by an investment bank and announced a new partnership.

Details About the Upgrade of PLTR Stock

Investment bank William Blair raised its rating on PLTR to Market Perform from Underperform.

A software engineer intently typing code into a laptop with multiple screens in an office.

William Blair increased its rating on PLTR primarily due to the shares' sharp decline in recent weeks. Additionally, the investment bank expects the firm to obtain a contract from Washington to implement a payment tracking system. The latter tool is expected to help the federal government reduce its expenses and keep better track of the Pentagon's outlays.

William Blair is also upbeat about the company's guidance for 31% revenue growth and a 45% operating margin in 2025.

On the downside, PLTR's valuation is "still frothy," and the shares could drop more than 40% from their current levels "on government contract delays," according to the investment bank.

PLTR Announces New Partnership

PLTR announced that it had formed a joint venture with TWG Global "to redefine AI deployment in banking, investment management, insurance and other financial services." Utilizing PLTR's AI software and TWG's expertise in business operations and financial services, the entity will help financial firms integrate AI on a wide scale.

TWG reports that it "operates and invests in businesses with untapped potential and guides them to new levels of growth."

While we acknowledge the potential of PLTR, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than PLTR but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.