Palantir Technologies (PLTR) Stock Soars 1,880% Since ChatGPT Launch, But Falls 17% Recently
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1h ago
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Source: Fool
- Stock Volatility Analysis: Palantir's stock has surged 1,880% since the launch of ChatGPT in late 2022, but has recently fallen 17% due to valuation concerns and a rotation away from software stocks, indicating market divergence on its future growth prospects.
- Strong Financial Performance: In Q3, Palantir's revenue increased by 62% to $1.1 billion, marking its ninth consecutive quarter of acceleration, showcasing robust sales growth in both commercial and government sectors, and achieving a Rule of 40 score of 114%, indicating superior profitability compared to peers.
- Market Outlook: Analysts project a median price target of $200 for Palantir over the next year, suggesting a 17% upside potential, despite a bearish scenario indicating a 70% downside risk, reflecting a mix of confidence in its AI solutions and valuation concerns.
- Intense Competitive Landscape: While Palantir is recognized as a leader in AI decisioning platforms, its price-to-sales ratio of 105 is significantly above the software industry average, with analysts warning that its valuation may not be sustainable, requiring a 45% annual revenue growth to justify current stock prices.
Analyst Views on PLTR
Wall Street analysts forecast PLTR stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for PLTR is 192.88 USD with a low forecast of 50.00 USD and a high forecast of 255.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
17 Analyst Rating
5 Buy
10 Hold
2 Sell
Hold
Current: 177.070
Low
50.00
Averages
192.88
High
255.00
Current: 177.070
Low
50.00
Averages
192.88
High
255.00
About PLTR
Palantir Technologies Inc. is engaged in building software to assist in counterterrorism investigations and operations. The Company has built four principal software platforms, including Palantir Gotham (Gotham), Palantir Foundry (Foundry), Palantir Apollo (Apollo), and Palantir Artificial Intelligence Platform (AIP). Apollo is a cloud-agnostic, single control layer that coordinates ongoing delivery of new features, security updates, and platform configurations, helping to ensure the continuous operation of critical systems. Gotham enables users to identify patterns hidden deep within datasets, ranging from signals intelligence sources to reports from confidential informants. Foundry transforms the ways organizations operate by creating a central operating system for their data. AIP enables responsible artificial intelligence (AI)-advantage across the enterprise by using primary, core components built to effectively activate large language models and other AI within any organization.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
