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PLTR Stock Rises 75% Year to Date: Still a Buy, or Time to Wait?
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Key Takeaways
PLTR's U.S. commercial revenues rose 71% YoY in Q1, with AIP hitting a $1B annual run rate milestone.
The company closed 139 $1M+ deals in Q1, as AIP bootcamps speed enterprise AI adoption.
Despite a 2025 EPS growth forecast of 41.5%, PLTR's 202 P/E raises valuation risk for new investors.
Palantir Technologies Inc. (PLTR - Free Report) has soared 75% year to date, far outpacing the broader industry’s 15% average gain and the Zacks S&P 500 composite’s modest 5% advance. The question now facing investors: Does PLTR still offer an attractive entry point, or is it smarter to wait for a pullback?
Image Source: Zacks Investment Research
AIP Ignites: Palantir’s Secret Weapon Is Now the Growth Engine
At the heart of Palantir’s recent breakout is its Artificial Intelligence Platform (AIP), which is rapidly evolving into its primary growth engine. In the first quarter of 2025, U.S. commercial revenues surged 71% year over year and climbed 19% sequentially, propelling the segment past the $1 billion annual run rate milestone for the first time. Total contract value in this business soared 239% YoY, while the number of deals worth over $1 million more than doubled compared to the prior year.
Palantir’s AIP bootcamps — intensive onboarding and implementation sessions — have been instrumental in accelerating adoption. These programs equip enterprise clients to deploy production-ready AI solutions in record time, drastically reducing the time-to-value and demonstrating the platform’s intuitive interface and scalability.
At its core, AIP enables organizations to embed autonomous AI agents across workflows, shrinking decision timelines and scaling productivity by multiples, not mere percentages. While competitors focus on AI model development, PLTR is winning on deployment, offering turnkey, enterprise-ready solutions that drive real results from day one. The U.S. commercial business has now become Palantir’s most dynamic revenue driver, and AIP is the key accelerant.
Big Tech’s AI Push Intensifies
Tech giants like Microsoft (MSFT - Free Report) , Alphabet’s Google (GOOGL - Free Report) , and Salesforce (CRM - Free Report) are also ramping up their AI initiatives. Microsoft continues to expand its Copilot integrations across Office and Azure while strengthening AI governance. Google enhances Workspace and Vertex AI, with a growing emphasis on security and compliance. Meanwhile, Salesforce is layering AI across its CRM ecosystem through Einstein Copilot and Data Cloud, pushing toward deeply personalized user experiences.
Despite this intensifying competition from Microsoft, Google, and Salesforce, Palantir stands apart. Its strength lies in serving mission-critical sectors, such as defense, intelligence, and healthcare, where security, trust, and performance are non-negotiable. While Salesforce, Microsoft, and Google excel in customer-facing tools and broad AI frameworks, Palantir delivers deeply embedded, operational AI that drives high-stakes decision-making. That is a competitive edge that we believe its peers have yet to match.
PLTR’s Fortress Balance Sheet Adds Confidence
Palantir’s financial foundation remains robust. As of March 31, 2025, the company held $5.4 billion in cash and reported zero debt, giving it the flexibility to reinvest aggressively in growth without relying on external capital.
Revenue momentum also remains strong. First-quarter sales climbed 39.3% year over year. The company closed 139 deals worth at least $1 million, including 51 over $5 million and 31 surpassing the $10 million mark, a testament to rising enterprise demand and deeper platform penetration.
PLTR’s Earnings Momentum Holds Firm
The Zacks Consensus Estimate for second-quarter 2025 EPS stands at 14 cents, indicating a 55.6% jump from the prior year. Full-year earnings are forecasted to grow 41.5% in 2025, followed by 24% growth in 2026. Sales projections are similarly upbeat, with expected revenue growth of 38% in the second quarter, and full-year top-line expansion of 37% in 2025 and 28% in 2026.
Image Source: Zacks Investment Research
Valuation: Palantir’s Greatest Hurdle
PLTR’s valuation remains a meaningful overhang. Palantir trades at a forward P/E of 202, five times the industry average of 40. This lofty multiple bakes in extremely high expectations around future AI monetization and the strength of government contracts.
Such an aggressive valuation leaves little room for error. Any misstep in execution or downward earnings revision could trigger outsized volatility, underscoring the need for discipline and patience among prospective buyers.
Verdict: Hold Your Ground, But Avoid Chasing
Palantir is proving its capability as a serious contender in enterprise AI, backed by a compelling product, strong financials, and growing commercial traction. But the current valuation suggests the optimism is already largely priced in.
Long-term investors should continue holding their positions. However, new entrants may benefit from exercising caution. A more favorable entry point could emerge following a pullback or valuation reset, especially if near-term sentiment cools.
Image: Bigstock
PLTR Stock Rises 75% Year to Date: Still a Buy, or Time to Wait?
Key Takeaways
Palantir Technologies Inc. (PLTR - Free Report) has soared 75% year to date, far outpacing the broader industry’s 15% average gain and the Zacks S&P 500 composite’s modest 5% advance. The question now facing investors: Does PLTR still offer an attractive entry point, or is it smarter to wait for a pullback?
AIP Ignites: Palantir’s Secret Weapon Is Now the Growth Engine
At the heart of Palantir’s recent breakout is its Artificial Intelligence Platform (AIP), which is rapidly evolving into its primary growth engine. In the first quarter of 2025, U.S. commercial revenues surged 71% year over year and climbed 19% sequentially, propelling the segment past the $1 billion annual run rate milestone for the first time. Total contract value in this business soared 239% YoY, while the number of deals worth over $1 million more than doubled compared to the prior year.
Palantir’s AIP bootcamps — intensive onboarding and implementation sessions — have been instrumental in accelerating adoption. These programs equip enterprise clients to deploy production-ready AI solutions in record time, drastically reducing the time-to-value and demonstrating the platform’s intuitive interface and scalability.
At its core, AIP enables organizations to embed autonomous AI agents across workflows, shrinking decision timelines and scaling productivity by multiples, not mere percentages. While competitors focus on AI model development, PLTR is winning on deployment, offering turnkey, enterprise-ready solutions that drive real results from day one. The U.S. commercial business has now become Palantir’s most dynamic revenue driver, and AIP is the key accelerant.
Big Tech’s AI Push Intensifies
Tech giants like Microsoft (MSFT - Free Report) , Alphabet’s Google (GOOGL - Free Report) , and Salesforce (CRM - Free Report) are also ramping up their AI initiatives. Microsoft continues to expand its Copilot integrations across Office and Azure while strengthening AI governance. Google enhances Workspace and Vertex AI, with a growing emphasis on security and compliance. Meanwhile, Salesforce is layering AI across its CRM ecosystem through Einstein Copilot and Data Cloud, pushing toward deeply personalized user experiences.
Despite this intensifying competition from Microsoft, Google, and Salesforce, Palantir stands apart. Its strength lies in serving mission-critical sectors, such as defense, intelligence, and healthcare, where security, trust, and performance are non-negotiable. While Salesforce, Microsoft, and Google excel in customer-facing tools and broad AI frameworks, Palantir delivers deeply embedded, operational AI that drives high-stakes decision-making. That is a competitive edge that we believe its peers have yet to match.
PLTR’s Fortress Balance Sheet Adds Confidence
Palantir’s financial foundation remains robust. As of March 31, 2025, the company held $5.4 billion in cash and reported zero debt, giving it the flexibility to reinvest aggressively in growth without relying on external capital.
Revenue momentum also remains strong. First-quarter sales climbed 39.3% year over year. The company closed 139 deals worth at least $1 million, including 51 over $5 million and 31 surpassing the $10 million mark, a testament to rising enterprise demand and deeper platform penetration.
PLTR’s Earnings Momentum Holds Firm
The Zacks Consensus Estimate for second-quarter 2025 EPS stands at 14 cents, indicating a 55.6% jump from the prior year. Full-year earnings are forecasted to grow 41.5% in 2025, followed by 24% growth in 2026. Sales projections are similarly upbeat, with expected revenue growth of 38% in the second quarter, and full-year top-line expansion of 37% in 2025 and 28% in 2026.
Valuation: Palantir’s Greatest Hurdle
PLTR’s valuation remains a meaningful overhang. Palantir trades at a forward P/E of 202, five times the industry average of 40. This lofty multiple bakes in extremely high expectations around future AI monetization and the strength of government contracts.
Such an aggressive valuation leaves little room for error. Any misstep in execution or downward earnings revision could trigger outsized volatility, underscoring the need for discipline and patience among prospective buyers.
Verdict: Hold Your Ground, But Avoid Chasing
Palantir is proving its capability as a serious contender in enterprise AI, backed by a compelling product, strong financials, and growing commercial traction. But the current valuation suggests the optimism is already largely priced in.
Long-term investors should continue holding their positions. However, new entrants may benefit from exercising caution. A more favorable entry point could emerge following a pullback or valuation reset, especially if near-term sentiment cools.
PLTR currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.