Palantir upgraded to Equal Weight from Underweight at Morgan Stanley

Morgan Stanley analyst Sanjit Singh upgraded Palantir (PLTR) to Equal Weight from Underweight with a price target of $95, up from $60, following last night’s Q4 beat. Despite an “ultra premium” valuation, Morgan Stanley sees a lack of downside catalysts for the shares over the next four quarters, the analyst tells investors in a research note. The firm says that given the strength of Palantir’s outlook, it was wrong to expect slowing growth below the 30% level due to the tougher compares in 2025. “This leaves us with valuation as the primary remaining concern,” Morgan Stanley contends. The analyst still thinks Palantir’s long-term return outlook “screens unattractive” with the shares trading at 120-times estimated 2026 free cash flow, but says the company’s revenue is poised to grow 30%-plus in 2025 and that its “powerful” artificial intelligence story that is resonating in the market. As such, Morgan Stanley sees a lack of fundamental catalysts for the shares to re-rate lower over next several quarters.