We recently published a list of 10 S&P 500 Stocks That Outperformed Bitcoin in 2024. In this article, we are going to take a look at where Palantir Technologies Inc. (NASDAQ:PLTR) stands against other S&P 500 stocks that outperformed bitcoin in 2024.
Bitcoin’s price has fluctuated dramatically since U.S. President Donald Trump’s inauguration, with the cryptocurrency staying around $100,000 since achieving the milestone in December. Trump’s ascension as the president has fueled more Bitcoin optimism, with many expecting a more favorable regulatory environment for digital assets. After the SEC approved the first U.S. spot Bitcoin ETF last year, Bitcoin surpassed the $70,000 price milestone set for 2021. The acceptance was largely regarded as a watershed event for the cryptocurrency, increasing its attractiveness to more mainstream investors. This year, Bitcoin’s price has more than doubled. The token is widely projected to see even stronger price movement in 2025, with numerous industry analysts estimating a doubling in value to $200,000.
In an interview with CNBC, James Butterfill, head of research for crypto-focused asset management CoinShares, stated that Bitcoin values in 2025 might range between $80,000 and $150,000. Butterfill stated that in the long run, it would not be “unreasonable” to anticipate Bitcoin to be worth around 25% of gold’s market share, up from roughly 10% presently. Should Butterfill’s $80,000 call be met, it will be due to President Trump’s failure to implement his promised pro-crypto measures.
Hedge Fund Managers’ Stance on Bitcoin
Of course, a few hedge fund managers have joined to claim a piece of the Bitcoin pie as well. ARK Invest’s Cathie Wood, for example, remains unwavering in her prediction that Bitcoin will reach $1.5 million by 2030. Known for her ambitious tech projections, the financial expert outlined the scenario at Ark’s Big Ideas 2025 conference, revealing that the chances of attaining this massive sum had actually grown. The investor has proposed three options: a middle-ground of $710,000, a cautious estimate of $300,000, and the bull scenario of $1.5 million.
Given all of this, is Bitcoin a worthwhile investment? Even the most popular cryptocurrencies, such as Bitcoin, have fluctuated in value, the market isn’t as transparent as it is for stocks, transactions are irreversible, and consumer safeguards are low or nonexistent. According to Charles Schwab, as long as Bitcoin is extremely volatile and susceptible to large transaction fees, it appears that it will have little utility as a means of trade or a store of wealth. With that in mind, it is understandable that equities tend to be less volatile than cryptocurrencies, including Bitcoin.
Our Methodology
For this list, we focused on stocks in the S&P 500 with a price performance greater than that of BTC (92.73%) as of February 17. These stocks are ranked in ascending order according to their 1-year price performance. In addition, we mentioned hedge fund sentiment around each stock to provide further insight into their market standing.
Why do we care about what hedge funds do? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
A software engineer manipulating a vast network of code on virtual monitors.
Palantir Technologies Inc (NASDAQ:PLTR)
1-Year Price Performance: 409.23%
Number of Hedge Fund Holders: 43
Palantir Technologies Inc. (NASDAQ:PLTR) is a data analytics and software company that creates and installs software platforms that help intelligence agencies and other companies comprehend large data sets.
Palantir Technologies (NASDAQ:PLTR) announced results that came above forecasts in the fourth quarter. The data analytics company reported adjusted earnings of $0.14 per share on $827.5 million in revenue for the fourth quarter, above analysts’ expectations of $0.11 per share and $778.2 million. Total revenue for the quarter climbed by 36% year-over-year, with CEO Alex Karp citing growing demand for AI.
Following Palantir’s Q4 earnings beat, Morgan Stanley analyst Sanjit Singh raised the stock to Equal Weight from Underweight, with a price target of $95, up from $60. Despite an “ultra premium” price, Morgan Stanley expects no downside triggers for the stock over the next four quarters. Given Palantir’s strong forecast, the firm believes it was incorrect to predict growth to dip below 30% in 2025 due to tougher comparisons.
Alger Mid Cap Focus Fund stated the following regarding Palantir Technologies Inc. (NASDAQ:PLTR) in its Q4 2024 investor letter:
“Palantir Technologies Inc. (NASDAQ:PLTR) builds advanced platforms for data integration, management, and security, enabling interactive, AI-assisted analysis for its users. Its core offerings include Palantir Gotham, designed for government clients, and Palantir Foundry, tailored for commercial customers. Originally focused on U.S. intelligence agencies, Palantir has expanded into defense contracts with western governments and entered the commercial market in 2016. During the quarter, shares contributed to performance after the company reported better-than-expected fiscal third quarter operating results, along with management raising its full year 2024 revenue guidance. Management noted that the recent launch of its AI platform (AIP), which leverages generative AI to optimize business operations, has driven significant growth and investor interest. Additionally, we believe Palantir could be a key partner for the U.S. government’s new Department of Government Efficiency (DOGE), as its AI-driven platforms are ideally suited to help identify inefficiencies, allocate resources effectively, and achieve cost reductions.”
Overall, PLTR ranks 1st on our list of S&P 500 stocks that outperformed bitcoin in 2024. While we acknowledge the potential of PLTR as an investment, our conviction lies in the belief that certain 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.
