Palantir Technologies (PLTR) has emerged as one of the biggest winners of the 2025 artificial intelligence rally. The Denver-based data analytics company now holds a market capitalization near $440 billion and has gained 145% year to date, far outpacing the S&P 500’s (SPX) roughly 15% return.
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Over the past 12 months, Palantir shares have returned 305%, reaching a 52-week high of $190 in August. The company’s growth has been driven by surging adoption of its AI-powered data platforms, expanding commercial partnerships, and new billion-dollar government contracts.
However, analysts have also warned that Palantir’s premium valuation, currently at 409 times forward earnings, leaves little room for error if growth slows.
BofA Raises Target as AI and Defense Sales Accelerate
Bank of America Securities (BAC) lifted its price target on Palantir to $215 from $180 while reiterating a “Buy” rating. 5-star analyst Mariana Perez Mora cited Palantir’s growing list of government and enterprise contracts and rising use of Agentic AI within its field operations.
Mora pointed to surging adoption of the Maven Smart System, which NATO selected earlier this year, and said Palantir’s Field Deployment Engineers are now “deepening use of Agentic AI” to scale its platforms.
She added that government sales could surpass $8 billion by 2030, with long-term revenue growth projected at a 30% compound annual rate. Palantir continues to show momentum in key sectors that align directly with its AI leadership and operational execution, according to Mora.
Palantir’s Record Quarter Pushes Revenue Past $1 Billion
Palantir reported its strongest quarter to date in August, with second-quarter revenue rising 48% year over year to $1.004 billion. It marked the company’s first billion-dollar quarter, powered by 68% U.S. revenue growth and a sharp 93% increase in U.S. commercial sales.
Adjusted operating income climbed to $464 million, representing a 46% margin, while adjusted earnings per share hit $0.16. The company’s Rule of 40 score, an indicator combining growth and profitability, reached 94%, signaling strong balance between expansion and efficiency.
Palantir closed 157 deals worth at least $1 million in the quarter, including 66 contracts exceeding $5 million and 42 above $10 million. Its backlog and remaining deal value also grew substantially.
For Fiscal 2025, Palantir now forecasts total revenue between $4.14 billion and $4.15 billion, up from prior estimates, and expects U.S. commercial revenue to surpass $1.3 billion, an 85% growth rate in that segment.
Is Palantir Stock a Buy, Sell, or Hold?
Despite BofA’s bullish stance, Palantir’s high valuation continues to divide analysts. HSBC (HSBC) raised its target to $181 from $111 in August but maintained a “Hold” rating, citing execution risks and valuation pressure.
Overall, the stock has a consensus rating of “Hold.” Among 19 analysts covering the company, four rate it a Buy, 13 suggest a Hold, and two call it a Sell.
The average 12-month PLTR price target stands at $157.72, implying a downside potential of 10.8%.
