Palantir has a long runway of growth, but the appreciation has become foamy.
Alphabet still has many potential growth trees.
Gitlab has been overlooked and the new hybrid chair-plus-usage price model can help power growth.
10 shares that we like than Palantir Technologies ›
Palantir Technologies(Nasdaq: PLTR) Has been one of the best performing shares in the market for the past two years, largely thanks to the growing demand for its artificial intelligence platform (AIP). Instead of trying to develop another large language model (LLM), the Palantir platform was developed to make AI models more useful. It brings together data from several sources, organizes it and connects it to Real-World Assets. These clean data help to reduce AI -Hallucinations and make it more usable. In essence, AIP has become related to an AI control system.
The company is growing rapidly, with a turnover of 48% year after year last quarter to reach $ 1 billion. The commercial sale of the American commercial almost doubled, while the income of the US government increased by more than 50%. Customers also spend more, with net dollar retention at 128%, indicating that the platform is sticky and becomes more valuable over time.
Image source: Getty images.
The implementation of Palantir and future opportunities are not the issue for investors; appreciation. The shares act at a forward price-to-sales (p/s) multiple of more than 100 times 2025 analyst estimates. Note that this is sale, not income that we are talking about. When a share is so priced, even the smallest miss on growth can hit the shares hard.
I love the company, but that kind of superior does not leave much room for errors, and there are other technical names that give you a strong potential benefit without paying such a premium. Let’s look at two to consider.
Alphabet (Nasdaq: Googl)(Nasdaq: Goog) Is one of the best positioned companies for AI because it already manages the front door to the internet for billions of people. Most of us already use Google search assignments every day, and sometimes we may not even realize it, because it is the standard search engine on most Android and Apple devices.
So although AI is changing the landscape, the advantage of Alphabet is that it does not have to change consumer behavior, it just has to make those products better with AI. That is exactly what it does with its new AI-driven search functions, including AI overviews, lens and circle to search. It is also just starting to roll out its new AI mode worldwide, which looks more like a traditional AI chatbot. However, users can easily switch between AI and search modes without changing apps. At the same time, the Gemini app recently became the most downloaded app in the Apple App Store, which surpasses Chatgpt, with the steps that the company has taken in this area.
Alphabet also builds one of the best cloud computing companies on the planet. It is one of the few companies that owns the entire stack, with its own AI model, adapted AI chips, leading data analysis and software, and even its own private fiber network. His Waymo Robotaxi also has a huge growth potential because it quickly expands in the US, and it has even taken steps in Quantum Computing with his willow chip.
The stock is not nearly as far as some of the other AI playing, so you do not pay in the same premium as you are with Palantir.
Gitlab (Nasdaq: GTLB) Is an underrated way to play growth in AI-driven software development, but make no mistake: this is a fast-growing company. In fact, it has grown its income with between 25% and 35% for eight straight quarters.
What started as a DevSOPS platform is now a full Lifecycle solution for software development that helps developers save time. The company has leaned to AI with his DUO AI agent, who helps to automate repetitive tasks and free up more time for developers to cod. This is important because developers cod only about 20% of their time, so every tool that frees them to write more code will stimulate productivity and thus require its solution.
Ai has not hurt Gitlab; In any case, it has accelerated the pace of software development, which benefits the company. If you look at the growth of Cloud Computing, many of them are around the AI software development, which lands exactly in the wheelhouse of Gitlab. The company works together with both Google Cloud and Amazon Webservices (AWS), so it benefits from this growth. Enterprise customers spend more and its customers also switch to plans with a higher level.
What is the most exciting about the Gitlab story is, however, the shift to a hybrid chair-plus-usage price model. The user component helps to protect the company if AI ultimately leads to fewer coders, while at the same time it gets more growth potential. For investors who are looking for an AI game that is still reasonably priced with a long runway of growth, Gitlab is worth taking a look.
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Geoffrey Seiler has positions in alphabet and Gitlab. De Motley Fool has positions and recommends alphabet, Amazon, Apple, Gitlab and Palantir Technologies. The Motley Fool has a disclosure policy.
Do you have to forget Palantir and buy these 2 technical shares instead? was originally published by the Motley Fool
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