Shares of Palantir Technologies (NASDAQ:PLTR) gained 6.43% over the past five trading sessions, continuing a rally that has seen the stock rise 114.59% over the past six months. Since its October 2022 IPO, PLTR has surged an eye-catching 1,515%.

While the stock’s forward P/E ratio — currently 239.86 — can be concerning, Palantir’s federal contracts and aerospace ties are expected to continue fueling growth. While earnings are rear-facing, the emerging trends seen in the company’s Q1 results can serve as a foundation for further rewards for shareholders. In the first quarter, Palantir saw year-over-year revenue growth of 39%. U.S. commercial business surpassed a $1 billion run rate, good for 71% year-over-year growth. Meanwhile, its U.S. government revenue grew 45% year-over-year. 

That’s being reflected by analyst sentiment. This week, Mizuho upgraded Palantir to “Neutral” from “Underperform” with a price target of $135, up from $116. The firm views the company’s recent execution and momentum as “stunning,” including material upward estimate revisions across Palantir’s commercial and government segments, which Mizuho admits to “very much” underestimating. Palantir has a “legitimate chance” to accelerate revenue growth for a fifth consecutive quarter when reporting Q2 results in early August, Mizhuo told investors in a research note.

However, PLTR’s market multiple implies it could take an investor nearly half a century to recover their initial investment, assuming earnings remained constant. But the assumption from the company — and from Wall Street analysts — is that earnings will continue to grow. EPS in Q1 2024, for example, stood at 8 cents, while EPS in Q1 2025 rose to 13 cents, good for an increase of 62.5%. So while there is concern about its valuation, what can investors expect from Palantir over the next year? 24/7 Wall St. did some analysis, so let’s take a look at.

Why Invest in Palantir?

The AI environment is ripe for growth, though, of which Palantir should play a major part. According to Grand View Research, the AI market is expected to reach $1.811 trillion by the end of the decade, good for a 35.9% compound annual growth rate (CAGR) between 2025 and 2030. The global market size of AI in 2024 was $279.2 billion, meaning at that forecasted CAGR, by the end of 2025, the market should expand to $379.4 billion. Companies like Palantir that focus on broad AI applications in diverse industries should see the lion’s share of that growth.

This industry growth potential is one reason Palantir provided strong guidance in its Q1 earnings call, stating that it expects 36% revenue growth, with free cash flow guidance of $1.6 billion to $1.8 billion. Not only has the company seen sizable growth, it forecasts sustainable momentum that will help continue that pattern over the course of the next year. Palantir’s government segment, which  contributes 55% of revenue, grew 45% year-over-year in Q1 2025 to $373 million. High-profile contracts, like the recently signed ICE deal and NATO’s adoption of its AI-enabled military system, highlight its critical role in national security. President Trump’s emphasis on defense and government efficiency, exemplified by the Department of Government Efficiency led by Elon Musk, positions Palantir as a go-to AI software provider, boosting investor confidence amid tariff-related market challenges.

Additionally, the company’s commercial segment has skyrocketed, with U.S. commercial revenue up 71% year-over-year to $255 million in Q1 2025. Its Artificial Intelligence Platform (AIP), launched in 2023, empowers enterprises in healthcare, finance, and manufacturing to harness AI for data analytics. Strategic partnerships and 139 deals worth $1 million or more in Q1 (31 were over $10 million) demonstrate Palantir’s private-sector expansion, helping to drive stock gains.

Palantir’s focus on operational efficiency has improved profitability, with adjusted operating margins expanding to 36% in Q1 2025 from 29% in 2024. Its software-as-a-service model, with high-margin recurring revenue, supports scalability across government and commercial clients. The company’s ability to deploy AIP rapidly, as shown by a 69% increase in customer count to 593, enhances revenue predictability. This profitability, coupled with $3.9 billion in cash reserves, fuels R&D and market expansion, reinforcing investor optimism.

Palantir (PLTR) as a Stock

Since its IPO, Palantir has seen uncommon and exponential share appreciation, rising more than 1,490% since going public on Oct. 2, 2020. An enormous part of that growth came between February 2023 and February 2025, before the market began to correct this year. After reaching its all-time-high on Feb. 18, shares of PLTR fell by more than 40% before bottoming on April 4. But for patient, buy-and-hold investors, they have already been rewarded as the stock has pushed back up and established new all-time highs. Since its year-to-date low, PLTR has gained nearly 97%. 

Following the company’s Q1 earnings report, Royal Bank of Canada and Deutsche Bank reiterated their “Underperform” and “Sell” ratings, respectively, on the AI data analytics firm. Most other analysts, though, maintained their “Hold” ratings. A notable exception was Wedbush analyst Dan Ives, a PLTR perma-bull who reiterated his buy call, saying Plantar  is”one of our top tech names to own” and setting a $140 per share price target.

Broadly, 16 Wall Street analysts assign the stock a consensus “Hold” rating, with three analysts giving it a “Buy” rating, nine giving it a “Hold” rating and four giving it a “Sell” rating. However, price targets for the AI darling represent a vast spread of opinions, with the high-end price target at $160.00, the median price target at $106.71 and the low-end price target at $40.00.

Estimate	Price Target	%Change From Current Price
Low	$40.00	-73.07%
Median	$106.71	-28.18%
High	$160.00	7.68%

Palantir Technologies 2025 Outlook

Palantir has made several important announcements over the past few weeks, including a $30 million contract with ICE to develop a system to help with deportations, and a partnership with TWG Global and xAI to bring AI to the financial services industry. That news has driven the stock higher in the short term. But as the broad market’s outlook remains clouded, so too does Palantir’s. That is reflected in Wall Street’s consensus “Hold” rating. 

The coming year for Palantir’s stock performance will continue to be shaped by the contracts it wins, both with the government and the private sector. Analysts project a 35% increase in revenue to $3.88 billion this year, though PLTR raised its guidance to $3.89 billion to $3.9 billion, up from its prior forecast of $3.74 billion to $3.75 billion.

Palantir calls for a minimum 68% jump in commercial revenue to $1.178 billion, with CEO Alex Karp saying, “We are delivering the operating system for the modern enterprise in the era of AI.” While Palantir does face competition from both large AI Big Data forms, as well as smaller, fast-growing AI data analytics shops, the company can be seen as having an entrenched position within government and large enterprises.

24/7 Wall St.’s 12-month price target for Palantir Technologies is similarly bearish at $107, which represents potential downside of 27.98% from today’s stock price. Those figures are based on Palantir having developed the premier AI software, but the decreasing cost of AI and expansion of large language models to lower barriers to entrance in decision-making software. We see projected revenue growth rates moderating over time climb from $3.9 billion in 2025 to $11.9 billion in 2030, alongside normalized EPS growth of $0.58 in 2025 to $1.44 in 2030.  

Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.