Palantir Technologies (PLTR) has been on quite a ride in 2024, with its stock price soaring by 360% over this period. This success culminated in entering the S&P 500, officially making the year a tremendous one. As we head into 2025, the question is whether this AI-driven company can maintain its momentum. The signals coming from Wall Street are mixed, but they don’t seem to affect PLTR stock, which seems obsessed with staying in the green zone.
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If you wish to read about Palantir’s prospects in 2025, you should read what our analyst at Tiprank, Bernard Zambonin, had to say about PLTR stock.
Let’s explore three key points highlighting why Palantir remains a stock to watch despite mixed analyst sentiments and a neutral Smart Score:
Growth and Execution
Palantir has positioned itself as a leader in AI-driven data analysis, with products like Gotham and Foundry aiding both government and commercial sectors. The company’s ability to handle large, complex datasets separates it from competitors. In Q3, Palantir’s commercial revenue grew by 54% year-over-year, and overall revenues increased by 30%. This growth and an adjusted operating margin of 38% showcase Palantir’s strong execution. Moreover, the company’s free cash flow is staggering, at $4.56 billion.
Analyst Sentiments and Valuation Concerns
Despite Palantir’s impressive performance, not everyone is convinced about its valuation. The stock is trading at a forward P/E ratio of 404x, with the industry’s average range between 20x and 40x, It looks like no matter what the company does, it’s always back to its crazy valuation. Some investors believe the stock’s current price already reflects its future growth potential, making it a risky bet at these levels.
Positive Market Sentiment and Fundamentals
On the flip side, market sentiment around Palantir remains largely positive. The stock has a Smart Score of 4 (Neutral) on TipRanks, but blogger sentiment is bullish, and news sentiment is very bullish, with 100% of recent news being positive. Additionally, crowd wisdom is very positive, and the company’s fundamentals are strong, with a return on equity of 12.40% and asset growth of 37.55% over the past 12 months.
Is PLTR a Buy, Sell, or Hold?
On Wall Street, Palantir is a Hold, emphasizing the stock’s mixed signals. The average price target for PLTR is $44.85, implying a 43.35% potential downside.
Conclusion
While Palantir’s valuation might seem stretched, its strong growth, execution, and positive market sentiment suggest that it could still have room to run in 2025. For the last few months, there’s been a trend among investors, thinking the stock has reached its ceiling, but PLTR stock is going about its business and sustaining its own trend.
