Palantir Technologies, a prominent data-analytics firm primarily serving the U.S. government, has significant growth potential according to Wedbush analysts led by Dan Ives.

Throughout this year, Palantir stock has surged 64%, driven by enthusiasm surrounding artificial intelligence. On Thursday morning, it increased by 0.6% in premarket trading to $28.38 while futures tracking the S&P 500 rose slightly by 0.1%.

Despite a general tech selloff on Wednesday, Wedbush maintained an Outperform rating for Palantir with a price target of $35 and suggested that shares could reach as high as $50 if companies continue increasing their AI-related spending.

Wedbush stated: “Palantir is well-positioned to capitalize on this $1 trillion AI spending wave with more applications addressing critical issues across industries and enhancing data-driven decision-making.” They believe that the company’s value remains underestimated and misunderstood.

However, not all analysts share this optimism. Mizuho’s team led by Gregg Moskowitz downgraded Palantir stock from Neutral to Underperform earlier in the week due to concerns that its current valuation is overly inflated.