Palantir Technologies Shows Strong Growth Potential
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 6d ago
0mins
Should l Buy PLTR?
Source: Fool
- Significant Revenue Growth: Palantir's Q3 revenue increased by 63% year-over-year, driving a 51% rise in operating income, indicating strong growth momentum in the AI sector, with expectations for this trend to continue through 2029, further solidifying its market position.
- Diverse Customer Base: With clients including the Department of Defense, CDC, and IRS, over half of Palantir's revenue comes from government customers, highlighting its unique position and strong demand in the decision intelligence industry.
- Broad Market Outlook: According to Precedence Research, the global decision intelligence platform market is projected to grow at an average annual rate of over 15% through 2035, positioning Palantir as the leader best suited to capture market share.
- Enhanced Profitability: By reusing a basic coding framework to lower client development costs, Palantir is expected to achieve higher profit margins, which will further increase as its customer base expands, attracting more investor interest.
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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: 130.010
Low
50.00
Averages
192.88
High
255.00
Current: 130.010
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.
Palantir's Stock Pullback Amid AI Potential
- Stock Performance Review: Palantir's shares have surged 1,666% over the past three years, yet have declined 10% year-to-date, reflecting market concerns about future growth amid current high valuations.
- Significant Revenue Growth: In Q4 2024, Palantir's revenue soared 93% year-over-year to $1.1 billion, with U.S. commercial sales jumping 137% to $507 million, indicating a successful pivot towards business clients.
- AI Platform Launch: The introduction of Palantir's Artificial Intelligence Platform (AIP) enables clients to securely integrate large language models with internal data, enhancing data querying and analysis efficiency, particularly in public safety and military applications.
- Competitive Landscape Analysis: Despite Palantir's market advantages in data analytics, it faces fierce competition from companies like Microsoft and Snowflake, and its forward P/E ratio of 158 significantly exceeds the S&P 500's 22, limiting future growth potential.
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- Stock Volatility: Palantir's stock has surged over 1,900% since the start of 2023, adding more than $300 billion in market value, yet it has plummeted 37% since hitting an all-time high in November, indicating market concerns about its future.
- Core Platform Advantage: Palantir's Gotham and Foundry platforms have driven profitability ahead of Wall Street expectations, with Gotham providing critical support to the U.S. government and Foundry helping commercial clients optimize data flows, although with only 780 customers, it highlights significant long-term growth potential.
- Historical Bubble Warning: While AI is seen as the next major technological trend, history suggests that similar bubbles, like the internet, may emerge, as investors often overestimate the speed of technology adoption and optimization, potentially leading to significant value loss for Palantir and its peers.
- Valuation Risks: Palantir's price-to-sales (P/S) ratio reached 100 before the fourth quarter, and although it has dropped to 69.3, it remains well above historically sustainable levels, indicating that its stock may need to decline by at least 60% to escape bubble territory.
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- Government Client Expansion: The U.S. government, Palantir's largest customer, is expanding its use of the company's solutions to embrace AI and modernize its infrastructure, which not only drives Palantir's revenue growth but also strengthens its position in the government market.
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- Significant Price Volatility: Since the beginning of 2023, Palantir's stock has surged over 1,900%, adding more than $300 billion in market value; however, it has dropped 37% since hitting an all-time high in November, indicating market concerns about its future.
- Clear Competitive Advantages: Palantir's Gotham and Foundry platforms face little large-scale competition in the AI and machine learning-driven SaaS market, with Gotham serving the U.S. federal government, ensuring profitability and market position.
- Customer Growth Potential: By the end of 2025, the Foundry platform had 780 commercial customers, representing a 37% year-over-year growth, although this number is still small, indicating significant long-term growth potential and market share expansion opportunities.
- Historical Lessons Caution: Despite Palantir's strong performance in AI, historical trends suggest that similar technology trends often experience bubble bursts, with analysts predicting a potential 60% decline from its record high, which could pressure investor sentiment.
See More
Palantir's Stock Pullback Amid AI Potential
- Stock Performance Review: Palantir's shares have surged 1,666% over the past three years, yet have declined 10% year-to-date, reflecting market concerns about future growth amid current high valuations.
- Significant Revenue Growth: In Q4 2024, Palantir's revenue soared 93% year-over-year to $1.1 billion, with U.S. commercial sales jumping 137% to $507 million, indicating a successful pivot towards business clients.
- AI Platform Launch: The introduction of Palantir's Artificial Intelligence Platform (AIP) enables clients to securely integrate large language models with internal data, enhancing data querying and analysis efficiency, particularly in public safety and military applications.
- Competitive Landscape Analysis: Despite Palantir's market advantages in data analytics, it faces fierce competition from companies like Microsoft and Snowflake, and its forward P/E ratio of 158 significantly exceeds the S&P 500's 22, limiting future growth potential.
See More
Analysis of Peter Thiel's Investment Portfolio
- Tesla Position Change: Peter Thiel reduced his Tesla holdings by 76% in Q3 2025, yet it remains the largest position in his portfolio, indicating ongoing confidence in the electric vehicle market despite skepticism towards Musk's humanoid robot strategy.
- Microsoft Investment Increase: Thiel purchased 49,000 shares of Microsoft in Q3, elevating it to the second-largest holding at 34% of his total portfolio, reflecting his optimism about Microsoft's cloud services and AI integration, even as the company faces growth slowdowns.
- New Investment in Apple: Thiel initiated a new position in Apple by acquiring over 79,000 shares in Q3, suggesting he sees potential in Apple's AI capabilities, particularly its vast iPhone sales network and upcoming AI-powered smart glasses.
- AI Stock Selection: Although Thiel's hedge fund holds only three AI stocks, his choices of Microsoft and Apple demonstrate a preference for technology builders, indicating a belief that these companies will play a more significant role in future technological revolutions.
See More
Palantir's Stock Volatility and AI Bubble Risks
- Stock Volatility: Palantir's stock has surged over 1,900% since the start of 2023, adding more than $300 billion in market value, yet it has plummeted 37% since hitting an all-time high in November, indicating market concerns about its future.
- Core Platform Advantage: Palantir's Gotham and Foundry platforms have driven profitability ahead of Wall Street expectations, with Gotham providing critical support to the U.S. government and Foundry helping commercial clients optimize data flows, although with only 780 customers, it highlights significant long-term growth potential.
- Historical Bubble Warning: While AI is seen as the next major technological trend, history suggests that similar bubbles, like the internet, may emerge, as investors often overestimate the speed of technology adoption and optimization, potentially leading to significant value loss for Palantir and its peers.
- Valuation Risks: Palantir's price-to-sales (P/S) ratio reached 100 before the fourth quarter, and although it has dropped to 69.3, it remains well above historically sustainable levels, indicating that its stock may need to decline by at least 60% to escape bubble territory.
See More
Comparing AI Prospects of Palantir and UiPath
- Palantir Revenue Surge: Palantir Technologies experienced a 70% year-over-year revenue increase last quarter, marking its tenth consecutive quarter of accelerating revenue growth, highlighting the significant impact of its Artificial Intelligence Platform (AIP) on customer expansion and spending.
- Government Client Expansion: The U.S. government, Palantir's largest customer, is expanding its use of the company's solutions to embrace AI and modernize its infrastructure, which not only drives Palantir's revenue growth but also strengthens its position in the government market.
- UiPath's Market Potential: UiPath's stock currently trades at a forward price-to-sales ratio of 3.7, and if its sales growth can accelerate similarly to Palantir's, it is expected to offer significant upside for investors, especially as its Maestro platform becomes the orchestration layer for AI agents.
- RPA and AI Integration: While the RPA business may face disruption from AI, UiPath's background provides a governance and compliance foundation for its Maestro platform, enabling effective management of AI agents from various vendors, thereby enhancing cost efficiency for clients as AI agents proliferate.
See More
Thiel Reduces Tesla Stake, Increases Microsoft and Apple Holdings
- Tesla Stake Reduction: Thiel slashed his Tesla holdings by 76% in Q3 2025, although it remains his largest position, indicating a cautious stance towards the electric vehicle market, possibly due to skepticism about Musk's humanoid robot strategy.
- Increased Microsoft Investment: Thiel purchased 49,000 shares of Microsoft in Q3, elevating its share to 34% of his hedge fund, reflecting his endorsement of Microsoft's focus on AI-integrated products, despite lower-than-expected growth in its cloud services.
- New Position in Apple: Thiel initiated a new position in Apple by acquiring over 79,000 shares in Q3, signaling confidence in Apple's AI potential, particularly its vast iPhone user base and upcoming AI-powered smart glasses.
- AI Investment Portfolio Analysis: Although Thiel's hedge fund does not hold Nvidia or Palantir, his investments in Microsoft and Apple demonstrate a preference for
See More
Palantir Faces Risks Amid AI Bubble Concerns
- Significant Price Volatility: Since the beginning of 2023, Palantir's stock has surged over 1,900%, adding more than $300 billion in market value; however, it has dropped 37% since hitting an all-time high in November, indicating market concerns about its future.
- Clear Competitive Advantages: Palantir's Gotham and Foundry platforms face little large-scale competition in the AI and machine learning-driven SaaS market, with Gotham serving the U.S. federal government, ensuring profitability and market position.
- Customer Growth Potential: By the end of 2025, the Foundry platform had 780 commercial customers, representing a 37% year-over-year growth, although this number is still small, indicating significant long-term growth potential and market share expansion opportunities.
- Historical Lessons Caution: Despite Palantir's strong performance in AI, historical trends suggest that similar technology trends often experience bubble bursts, with analysts predicting a potential 60% decline from its record high, which could pressure investor sentiment.
See More
