After a stellar run last year, Palantir (PLTR) stock trades 25% below its all-time highs in April 2025. Similar to other tech stocks, PLTR stock has pulled back in recent trading sessions due to concerns about its valuation and an escalating U.S.-China trade war.
Palantir develops software platforms for counterterrorism, among other critical operations, globally. Its Gotham platform reveals hidden patterns in diverse datasets, while Foundry creates central operating systems for organizational data. Palantir Apollo enables remote software deployment, and the AI Platform integrates various large language models to transform data and organizational processes into tools for humans and AI agents.
While Palantir is looking to diversify its revenue base, it generates a sizeable portion of its top line from government agencies. According to a Reuters report, SpaceX, Palantir, and Anduril are collaborating on a proposal to build a crucial component of President Donald Trump’s “Golden Dome” missile defense system.
The partnership aims to deploy between 400 and 1,000 tracking satellites and potentially 200 attack satellites equipped with missiles or lasers, although SpaceX’s team is not expected to handle the weaponization aspects.
In an unusual approach, SpaceX is proposing a “subscription service” model where the government would pay for access rather than owning the hardware, raising concerns about long-term control. A growing customer base is key for Palantir as it navigates near-term headwinds over the next 12 months.
Should You Buy Palantir Stock Right Now?
Palantir Technologies is accelerating its growth strategy through an expanding network of high-profile collaborations, as evidenced by recent announcements in both the defense industrial base and the AI sector.
Palantir’s Warp Speed platform has secured six new defense and maritime customers — Epirus, Red Cat, Saildrone, Saronic, SNC, and Ursa Major — focusing on accelerating American manufacturing capabilities for critical defense technologies.
These partnerships strengthen Palantir’s position in the national security space by integrating its software into the production of everything from autonomous surface vessels to drone technologies and propulsion systems.
Simultaneously, Palantir is leveraging its government compliance expertise through its FedStart offering, which helps companies like Anthropic bring advanced AI capabilities to government customers. This partnership allows Anthropic’s Claude AI application to meet stringent security standards, creating new revenue opportunities in the federal space.
The company has also entered the healthcare sector through a strategic partnership with R1, a leader in revenue cycle management. Their joint venture, R37, combines Palantir’s AI systems with R1’s healthcare expertise to address the significant administrative costs facing U.S. hospitals.
Palantir’s expansion strategy demonstrates its ability to position its technology platforms at the intersection of critical industries — defense, artificial intelligence, and healthcare — while leveraging its government compliance expertise as a competitive advantage in bringing cutting-edge technologies to regulated markets.
Is PLTR Stock Still Overvalued?
Today, Palantir stock trades at a forward adjusted price-earnings multiple of 164x, which is quite lofty. Compared to that, its forward earnings multiple over the last three years was much lower at 99.5x.
Similar to other tech stocks, Palantir is asset-light and is poised to benefit from high operating leverage. Over the next five years, analysts expect Palantir’s revenue to grow by 31.6% annually, while its free cash flow is projected to grow by 38.5%.
Out of the 20 analysts covering PLTR stock, three recommend “Strong Buy,” 12 recommend “Hold,” one recommends “Moderate Sell,” and four recommend “Strong Sell.” The average PLTR stock price target is $84, which is below the current trading price.
