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On Wednesday, the stock market spiked as investors cheered a 90-day pause on reciprocal tariffs. The market recovery was led by the tech-heavy Nasdaq Composite Index ($NASX), which climbed more than 12% by the end of the day. Several big names enjoyed the bull ride, with data analytics company Palantir (PLTR) leading the comeback, soaring 19% in a single trading session.
However, the next day, the markets turned volatile once again and major indexes dropped more than 3% amid renewed uncertainty in the U.S.-China trade war. Palantir shares sold off again, and traded down on Friday, April 11.
Palantir shares hit an all-time high of above $125 in mid-February, delivering nearly a 930% return over the trailing two-year period. Yet, the stock remains 29% below its 52-week high.
This naturally leads to the question: Is Palantir a good buy at its current price, below $100? Let’s find out.
Palantir Stock Will Benefit From DOGE
In my view, Palantir is exceptionally well-positioned to benefit from government cost-cutting measures. Its Gotham platform empowers agencies to make faster, data-driven decisions that reduce inefficiencies and objectives that resonate with the Department of Defense’s review of high-cost contracts. With the Department of Government Efficiency (DOGE) emphasizing smarter, leaner government spending, Palantir’s long-term contracts offer both stability and significant growth potential.
Moreover, Palantir continues to distinguish itself as a reliable market player by leveraging its AI Platform (AIP) to transform vast datasets into clear, actionable insights. This not only aids in eliminating unnecessary costs but also substantially boosts operational efficiency. As federal agencies place greater emphasis on saving taxpayer dollars, Palantir’s intelligent solutions underscore its strong government relationships and highlight the company’s potential for a bright, resilient future.
Palantir Has Strong Fundamentals
Palantir’s strong financial performance is a testament to its evolving business model. In 2024, the company made $2.87 billion in revenue, a 29% increase from the previous year. U.S. sales jumped by 38%, with commercial revenue growing by 54%. This signals a shift from relying mostly on federal defense contracts to balancing its business across both public and private sectors.
In Q4 alone, revenue climbed 36% to $827 million, customer numbers increased by 43%, and the average spending per existing customer went up by 20%. These gains show deeper client engagement and the proven value of its platforms. Earnings per share (EPS) also saw a strong 75% increase, reaching $0.14 per share.
With a robust cash and securities balance of $5.2 billion, Palantir is well-equipped to support future projects.
Looking ahead, Palantir has given full-year 2025 revenue guidance, expecting a 31% year-over-year growth. For Q1 2025, the company is forecasting revenue between $858 million and $862 million and adjusted income from operations between $354 million and $358 million.
Analyst Opinions on PLTR Stock and Final Words
Wall Street analysts are currently taking a cautious stance on Palantir stock, with a consensus “Hold” rating. While the stock is trading above its mean price target of $84, its Street-high target of $125 still suggests a potential upside of around 42%.
Palantir shows strong growth, profitability, and momentum, but its high valuation remains the key concern.
With a market cap of $207 billion, Palantir is undeniably trading at a premium on paper. Its adjusted forward price-earnings ratio stands at a staggering 158x, and its forward P/S ratio is 55x, significantly above the sector median of 17.5x and 2.4x, respectively.
That said, this premium valuation could be justified. If Palantir achieves its $3.75 billion revenue target in 2025 and continues to grow at around 30% annually, its earnings could eventually surpass its current size over the next 5–10 years.
Moreover, unlike many AI companies that are still burning through cash, Palantir is delivering strong revenue growth and generating positive free cash flow. This financial efficiency sets it apart from peers and reinforces its potential for long-term, sustainable growth.
