Should one consider purchasing shares of Palantir Technologies at present?
Palantir Tech's shares have been on a roll, skyrocketing 340% in 2024 and a further 46% in 2025, making it one of the top-performing AI stocks. The secret to its success? Providing tangible savings for organizations, as proven by its 36% revenue jump in Q4 and 14% growth in the previous quarter.
But it's not just the government agencies that are benefiting. U.S. corporations are the real game-changers, with commercial revenue surging 64% year to year, outpacing even the government sector's growth. This growth is fueled by the 129 high-value contracts Palantir signed, up from 104 in Q3.
The real magic happens when companies tap into Palantir's AI capabilities. Take the automotive supplier, for instance. By automating routine checks, Palantir cut down manual work by 100 hours – a clear sign of AI's potential to revolutionize the way we work.
PLTR
And Wall Street agrees. With AI set to create trillions of dollars' worth of value in the economy, Palantir is gearing up to be a major player in this burgeoning market.
The future looks bright, with customers reporting "energy on the ground" and a clear impact from using Palantir's products. But should you jump on the Palantir bandwagon?
artificial intelligence (AI) stocks over the past few years. Another blowout earnings report sent the stock surging in early February. The stock rocketed 340% in 2024 and is already up 46% year to date in 2025.
While the stock's current $252 billion market cap might be tempting, it's important to remember that Palantir's revenue is relatively low compared to its valuation. At a price-to-sales ratio of 45, the shares are priced high, even taking the company's impressive growth rate into account.
So, while Palantir is undoubtedly a market leader, some caution is warranted. The stock might be overdue for a correction, given its sky-high valuation. It might be best to wait for a dip before making an entry.
bullish on the company's prospects. U.S. commercial revenue grew 64% over the year-ago quarter, outpacing the 45% increase in U.S. government revenue. Overall, Palantir closed 129 deals worth over $1 million each, up from the 104 deals it signed in Q3.
After all, even Palantir's growth rate in 2021 was almost 41% before the stock suffered a massive correction in 2022. The stock is currently priced for perfection, which puts it at a higher risk of a sell-off if expectations fail to materialize.
earnings call mentioned they feel energy on the ground talking to customers and the impact they are seeing from using the product. This bodes well for another year of strong growth.
Enrichment Data:
Palantir Technologies has established itself as a key player in the AI market, with its shares trading at a high valuation. Here are the current valuation metrics and analyst predictions for Palantir's stock in 2025:
market cap (share price times total shares outstanding) has shot up to $252 billion at the time of writing, which is steep compared to the company's $2.86 billion in trailing-12-month revenue. Palantir could double its revenue in 2025, representing a significant acceleration over its current growth rate, but the stock would still trade at an expensive
Current Valuation Metrics
- Price-to-Sales (P/S) Ratio: Palantir's shares are trading at a steep P/S ratio of about 74 times, raising concerns about the company's ability to grow into its current stock price.
- Price-to-Earnings (P/E) Ratio: The stock also has a high P/E ratio of approximately 454 times, indicating an overvalued price.
price-to-sales multiple of 45.
Analyst Predictions for 2025
- Price Targets: The consensus one-year price target for Palantir's stock is around $91.88, suggesting moderate growth from current levels. Some forecasts predict a higher price target of $120 by the end of 2025.
- Revenue and EPS Projections: Analysts expect Palantir to generate revenue of approximately $3.467 billion in 2025, with an EPS of $0.47. This growth is fueled by strong demand for AI software and Palantir's strategic positioning in the AI value chain.
- Analyst Sentiment: Despite strong earnings and growth potential, Wall Street remains cautious due to Palantir's high valuation. The stock has relatively few bullish calls, with more analysts holding a "Hold" or "Sell" rating.
free cash flow, the shares are trading at a high multiple of 238. That's pricing in a lot of growth even though the company is already converting a high percentage of its revenue into cash flow.
Long-Term Potential
- AI Market Opportunity: The AI market is expected to generate significant revenue in the coming years, with Palantir well-positioned to capitalize on its AI platform.
- Growth Projections Through 2030: Long-term forecasts suggest Palantir could achieve revenue beyond $8 billion by 2030, with a potential stock price of $192, representing substantial upside from current levels. However, these projections rely on the company maintaining high rates of expansion in the AI market.
- Investors who are bullish on Palantir's prospects might consider purchasing its shares, given its impressive performance in 2024 and 2025, with a 340% increase and a further 46% rise respectively.
- The high valuation of Palantir's shares, with a market cap of $252 billion and a price-to-sales ratio of 45, might make some investors hesitant, suggesting that a correction could be due.
- Palantir's stock performance is driven in part by its success in the finance sector, where it has seen a 64% year-over-year increase in commercial revenue, which surpasses the growth in the government sector.
- Looking towards 2025, analysts predict modest growth, with a consensus one-year price target of $91.88, and revenue projections of around $3.467 billion, despite the company's high valuation and cautious sentiment from Wall Street.