Palantir Technologies Inc ( PLTR ) shares are hitting new all-time highs on Wednesday. Here’s a look at what’s fueling the momentum.

What To Know: Palantir ( PLTR ) shares have risen more than 500% over the past year and are now up approximately 93% year-to-date.

Much of the momentum has been driven by the company’s positioning in the AI space. The stock also appeared to get a lift more recently from the Israel-Iran conflict. Palantir ( PLTR ) has several government contracts and has seen an acceleration since President Donald Trump took office, securing more than $113 million in contracts. Palantir ( PLTR ) was also awarded a $795 million contract modification by the U.S. Army for its Maven Smart System in May.

As defense budgets increasingly incorporate AI, Palantir ( PLTR ) could be a potential beneficiary of heightened geopolitical tensions. Palantir ( PLTR ) signed a strategic agreement with the Israeli Defense Ministry to support war efforts last year, per Bloomberg.

Even as Palantir ( PLTR ) shares continue to climb to new highs, some analysts believe there could be more room to run. Loop Capital analyst Mark Schappel maintained Palantir ( PLTR ) with a Buy and raised the price target from $130 to $155 earlier this month. At the end of May, Wedbush's Dan Ives predicted that Palantir ( PLTR ) shares will more than triple in two to three years to reach a $1 trillion market cap valuation, or approximately $427 per share.

"[Alex] Karp, he's playing chess, others are playing checkers. And I think you are starting to realize more and more in government, enterprise, and that's why you cannot talk AI revolution without saying Palantir,” Ives said in a CNBC interview.

Palantir ( PLTR ) has a strong momentum score of 99, according to Benzinga Pro data. The company beat analyst estimates in the first quarter as U.S. Commercial revenue grew 71% year-over-year and U.S. Government revenue climbed 45%.

Palantir ( PLTR ) also guided for second-quarter revenue in the range of $934 million to $938 million versus estimates of $899.12 million, and raised its full-year outlook. The company said in its earnings release that it’s experiencing “surging and ferocious growth.”

PLTR Price Action: Palantir ( PLTR ) shares traded as high as $147.67 on Wednesday, marking new all-time highs. The stock was up 0.18% at $142.94 at the time of publication, according to Benzinga Pro.

Palantir ( PLTR ) has an RSI of 66, per Benzinga data. A stock is generally considered overbought when its relative strength rises above 70.

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