Palantir is on its way to becoming a trillion-dollar company, according to prominent tech bull Dan Ives. The AI company's stock has surged more than 140% since the beginning of the year. Earnings beats , lucrative military contracts and the firm's CEO boasting about "crazy, efficient revolution" in terms of growing revenue while downsizing headcount, have all helped build buzz around the firm. The firm's shares popped 7.85% on Tuesday, after it reported $1 billion quarterly revenues for the first time, way ahead of analyst expectations. Since then, the stock has extended its gains and was last seen 1% higher in pre-market trading. PLTR YTD line Palantir share price Speaking to CNBC's "Squawk Box Europe" this week, Ives, who is global head of tech research at Wedbush Securities, outlined why he still sees huge upside ahead for the stock. Ives runs the Wedbush AI Revolution ETF, which counts Palantir among its top holdings. Labeling Palantir "the Messi of AI" — a reference to legendary Argentinian soccer star Lionel Messi — Ives said: "I believe this is going to be a trillion-dollar company in the next two to three years." "There's no company that has what they have when it comes to software and use cases, and I think they're exploding across the board," he explained. "And the government … they're really going to take the lead when it comes to AI on the sovereign front, and that's why they're one of our top names, and again, I think a trillion-dollar [market cap] in the next two, three years." Palantir currently has a market cap of around $432 billion, according to LSEG data. In a note on Tuesday, Ives raised his price target for Palantir from $160 to $200, citing "continued hyper growth demand for the company's AI product suite." If the stock achieves Wedbush's new target price, it would mark a 9.8% premium on Thursday's closing price. Earlier this week, Palantir CEO Alex Karp said the firm was "obliterating" the so-called "Rule of 40," a key metric investors use to evaluate potential returns on tech stocks. The metric ranks businesses by evaluating revenue growth and margins, with a score over 40% considered good. According to Karp, Palantir's score is 94%. Ives told CNBC on Wednesday that some investors already saw Palantir stock as overpriced, but warned that this approach could lead to missing out on the company's growth trajectory. "If you focus just on valuation, you missed every transformational tech stock the last 20 years," he said. "Many investors, they've hated [Palantir shares] at $20, despised it at $50, [been] screaming from the mountaintops at $100, $150, [but] they're revolutionizing tech." — CNBC's Alex Harring contributed to this article.
