Palantir Hits New All-Time High Near $155. Is $200 Next?

PLTR Keeps Breaking Records

Palantir Technologies (NASDAQ:PLTR) closed at $154.86 per share yesterday, but is surging more than 3% higher in morning trading today, hitting  $159.56 per share following Piper Sandler’s initiation of coverage with an overweight rating and a Street-high $170 per share price target. 

The firm praised Palantir’s “one-of-a-kind growth” and margin model, projecting a potential $24 billion revenue run-rate by 2032 through market share gains in government and U.S. commercial sectors, each valued at over $1 trillion. 

This bullish outlook underscores Palantir’s meteoric rise, with its stock up 111% year-to-date, fueled by its AI-driven platforms like Gotham, Foundry, and Apollo. But as the stock nears $160, investors are left wondering whether Palantir can maintain this rapid growth and reach $200 per share by year-end.

AI-Powered Rocket Fuel for Growth

Palantir’s growth is anchored in its ability to leverage artificial intelligence (AI) and data analytics across massive markets. Its first-quarter results showcased a 39% year-over-year revenue increase to $884 million, with U.S. commercial revenue soaring 71% to surpass a $1 billion annual run-rate. U.S. government revenue grew 45% to $373 million. 

The company raised its full-year 2025 revenue guidance to $3.9 billion, implying 36% growth. Strategic partnerships with Accenture (NYSE:ACN), SAP (NYSE:SAP), and Fannie Mae, alongside a $100 million nuclear company deal and BlueForge Alliance‘s WarpSpeed for warships, highlight Palantir’s expanding footprint.

Piper Sandler notes accelerating visitor traffic (to 144% year-over-year in the second quarter) comparable to AI leaders like CoreWeave (NASDAQ:CRWV) and Anthropic, signaling robust demand. Palantir’s AI Platform (AIP) and deepening Department of Defense (DoD) collaboration position it as a secular winner in the AI revolution, with potential to sustain 30% or more compound annual growth rates (CAGR) in both government and commercial segments.

Clouds on the Horizon

Despite its momentum, Palantir faces significant challenges. Its valuation is a glaring concern, trading at a price-to-sales (P/S) ratio of 121 and a price-to-earnings (P/E) ratio of 696, far exceeding peers. 

Piper Sandler acknowledges this “rich valuation premium” and warns of “hyper-volatile” shares with a history of 20% to 29% drawdowns. The stock is also sensitive to negative news, which, though rare, could trigger sharp corrections.

International commercial revenue declined 5% year-over-year in Q1, driven by Europe’s slower AI adoption, posing a headwind. Additionally, Wall Street has a one-year consensus price target for Palantir of $110 per share, suggesting a 31% downside from current levels, raising questions about sustainability. Regulatory risks, geopolitical tensions, and potential reductions in strategic commercial contracts in the second quarter could further dampen growth.

Navigating the High-Flying Tightrope

Palantir’s high valuation demands flawless execution to justify its premium. While its AI-driven solutions and strong U.S. market performance provide a solid foundation, volatility and international challenges require cautious optimism. Piper Sandler recommends a “buy on a drawdown” approach, advising investors to capitalize on dips rather than chasing highs. 

The stock’s near-2,400% surge since the beginning of 2023 reflects a compelling narrative but also amplifies the risk, as traditional value investors may overlook its growth potential in favor of valuation concerns. Sustaining free cash flow margins of 40% or better and a CAGR greater than 30% will be critical to reaching lofty targets.

Key Takeaway

Palantir is unlikely to reach $200 per share by year-end 2025. While its AI-driven growth, strategic partnerships, and robust U.S. performance support further upside, the stock’s extreme valuation and volatility suggest a correction is more probable than a 25% rally in five months. International headwinds and potential contract declines add further risk. 

For aggressive investors, Palantir is a buy on significant pullbacks — say, near $140 per share — as its long-term AI leadership potential remains strong, but chasing it at current levels is risky due to overstretched metrics. 

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