Does Palantir Have More Upside Than Any Other AI Stock?

Palantir (NASDAQ:PLTR) is a colossal winner that’s just found a way to keep winning in 2025. With shares up more than 37% in the past three months and over 105% year to date, questions linger as to whether the AI software titan is like an Nvidia (NASDAQ:NVDA), destined to smash past more records as momentum stays alive for longer, or if it’s a bubbly meme stock that could be in for a painful plunge. Most Wall Street analysts covering the name seem to think Palantir is the real deal.

They’ve been rushing to upgrade their price targets after sizeable runs. Of course, their upside revisions are well-supported by improving fundamentals and a growth narrative that’s starting to become more apparent to retail investors. Though it’s a tad late in the game to be chasing shares of PLTR, I do think Palantir has what it takes to keep raising the growth ceiling as more use cases and opportunities arise from the ongoing AI revolution.

Indeed, Nvidia can’t be the only stock to experience a generational surge at the hands of the AI boom. Though skeptics have every right to sit on the sidelines after a meteoric rise of 835% in two short years, I’m inclined to stick with the increasingly bullish crowd of Wall Street analysts who think CEO Alex Karp and his team have more to deliver.

Palantir stock is only getting more expensive. But Wall Street sees more upside

Now, Palantir stock isn’t without its fair share of risks, especially if you’re unable to value the name. At fresh highs just shy of $155 per share, PLTR shares go for 672 times trailing price-to-earnings (P/E) and 123.5 times price-to-sales (P/S). Indeed, it’s quite a challenge to find a stock with a higher P/E or P/S multiple at this juncture.

Either way, the big question is whether the opportunity in Palantir is large enough to drive down such multiples in the next 18-24 months. With a new growth spark to be excited about every couple of weeks, perhaps Palantir stock isn’t as bubbly as its multiples make it look. 

Recently, Piper Sandler analyst Brent Bracelin labelled Palantir as an “AI secular winner,” citing the firm’s “one-of-a-kind growth and margin model” as well as its ability to take a big chunk of two total addressable market (TAM) worth over $1 trillion. That’s extraordinary. When you factor in government contracts and commercial, Palantir could be looking at a market worth well north of $2 trillion, and that might be an underestimate. Indeed, most Wall Street analysts have been too conservative on the name in recent years. 

Analysts are staying upbeat, but it’s not the highest upside AI stock

Personally, I think it’s the commercial opportunity that could cause analysts to keep raising the bar on their estimates over the next few years. And, of course, as a software firm, Palantir can command some pretty respectable margins as its growth continues to kick into high gear. In any case, I share the optimism of PLTR stock’s bulls. Though I do think the name could get creamed in a market-wide correction.

With a 2.6 beta, PLTR stock could easily slip 25% if the S&P were to slide 10%. As such, I’d not look to chase the name as analyst price targets begin to imply less in the way of year-ahead upside. With JPMorgan recently cautioning investors from chasing the crowded “high beta” trade, I do think it’s wise to wait for a cooldown before seriously considering initiating a position in a name that may be overdue for a big round of profit-taking.

Despite being the biggest bull (at least so far), Bracelin suggests buying a dip. His $170 price target entails a very modset 9.6% gain from Thursday’s closing price. That’s not much gain for the amount of risk investors will need to take on.

For investors seeking greater upside from the AI boom, there are much cheaper plays out there with price targets that suggest way more in the way of upside. Some of them are hiding in plain sight in the group known as the Magnificent Seven.

So, in short, no, Palantir isn’t the only high-upside AI stock out there. Though, its chart certainly suggests it’s the AI stock to stick with as it faces new tests at new heights.

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