From Nasdaq: 2025-01-18 03:30:00

In 2024, Palantir Technologies (NASDAQ: PLTR) stock surged by 340%, making it the best-performing S&P 500 component. Despite this, analysts are overwhelmingly bearish, with a median price target suggesting a 45% downside from its current price of $71. Palantir’s recent 16% drop from its record high adds to the uncertainty.

Palantir, a data analytics software company, offers products like Foundry and Gotham that aid in integrating information and building machine learning models. Its AI platform, AIP, has received high praise from industry analysts. The company is positioned for growth in the AI market, which is expected to see a 41% annualized sales increase through 2028.

Palantir exceeded Wall Street expectations in Q3, with revenue up 30% to $726 million and non-GAAP earnings rising to $0.10 per share. CEO Alex Karp attributes this success to the launch of AIP, which has transformed the business and met the rising demand for advanced AI technologies from both government and commercial customers.

Despite promising growth prospects, Palantir’s stock is considered very expensive by Wall Street. Analysts expect adjusted earnings to increase by 31% in the next year, making its current valuation of 200 times adjusted earnings seem steep. Investors are advised to wait for a more attractive entry point before considering Palantir as an investment.

Wedbush Securities’ Dan Ives sees long-term potential in Palantir, comparing it to companies like Oracle and Salesforce. However, the stock’s current valuation is seen as unsustainable. While potential for growth exists, investors are cautioned against entering at the current price, as a significant correction could occur if earnings fall short of expectations.



Read more at Nasdaq: Is Palantir Stock a Buy in 2025 After Its 340% Gain in 2024? Wall Street Analysts Have a Surprising Answer