Palantir’s (PLTR) stock has been a battleground for analysts. Some remain optimistic about its AI-driven growth, while others argue it’s severely overvalued. Jefferies is holding its ground. The firm has maintained its Underperform rating, citing concerns over Palantir’s rich valuation and insider selling.
Analyst Brent Thill compared Palantir’s insider activity with that of Salesforce. Unlike Salesforce’s (CRM) incoming CFO, who has been buying shares, Palantir insiders have been selling. This difference, according to Jefferies, suggests lower confidence in Palantir’s long-term prospects.
Despite these concerns, Palantir continues to post strong financials. The company has an 80% gross profit margin and reported 29% revenue growth over the past year. However, even after a sharp decline, its valuation remains steep. Palantir trades at 39 times its projected 2026 revenue—still double the multiple of the next-highest software company.
William Blair Upgrades Stock but Sees Risks
Not all analysts are bearish. William Blair recently upgraded Palantir to Market Perform after a 33% drop in its stock price. The firm acknowledged that while Palantir is still “frothy,” there have been positive developments. However, they warned that delays in government contracts could lead to another 40% downside.
A looming government shutdown on March 15 is another concern. Analysts note that disruptions in federal spending could significantly impact Palantir, given its heavy reliance on U.S. government contracts.
PLTR Stock Price Targets Are All Over the Place
Palantir has seen a wide range of price targets. Some analysts expect it to fall below $75, while others have targets above $100. Morgan Stanley (MS) remains bullish, maintaining an Overweight rating with a $115 price target. Wedbush is even more optimistic, setting a $120 target and emphasizing Palantir’s AI dominance.
Meanwhile, some investors see Palantir as an unstoppable force. The stock has soared 1,200% since 2023, far outpacing AI giant Nvidia. It also secured a place in the S&P 500 (SPX) and Nasdaq-100 (NDX), cementing its status as a major player.
Palantir’s Future Hinges on Government and AI Growth
The company has continued expanding its reach. Recently, it rolled out Anti-Financial Crime technology at Société Générale to enhance fraud detection. It also reinstated Jeffrey Buckley as Chief Accounting Officer, signaling a focus on financial leadership.
Palantir’s long-term success depends on two things: sustained AI adoption and continued government spending. If government contracts slow or competition intensifies, analysts warn that its high valuation could come crashing down. But if Palantir keeps winning contracts and expanding its AI footprint, bullish investors might have the last laugh.
Is Palantir a Buy, Sell, or Hold?
Overall, the majority of analysts remain sidelined on PLTR stock, with a Hold consensus rating based on 16 Buys and three Holds. Over the past year, PLTR has increased by more than 250%, and the average PLTR price target of $93.13 implies an upside potential of 10.34% from current levels.
