With a history of products rooted in artificial intelligence computing, Palantir Technologies fungi The Monster Rally was performed in 2024 and lasted until early February. However, inventory collapsed and within two weeks it lost 30%.
At its peak on February 18th, Palantir shares rose 65% in 2025 alone, making a one-day jump of 23% following the company’s blockbuster revenue report on February 3rd. However, the company’s CEO will include confluence of events that include $1 billion in stocks and news that deserves a $1 billion shares and warning warnings regarding stock reductions and stock reductions and other events that include news that includes news that includes news that includes news that includes news that includes news that includes news that includes news that includes news that includes news that includes news that includes news that includes news that includes news that includes news that includes news that includes news that includes news that includes news that includes news that includes news that includes news that includes news that includes news that includes news that includes news that includes news that includes news that includes news that includes news that includes news that includes news that includes $1 billion in stock reductions and warnings regarding stock reductions and stock reductions.
Morningstar equity analyst Mark Giareli believes Palantia retains strong continued growth potential, and after that big decline, the stock is trading in a fairly valuable territory. However, he emphasizes that stock trajectories will be affected by wide shaking as investors continue to value the entire addressable market for Palantir’s analytical software products. This recent volatility warns investors to consider risk tolerance and carefully select their entry points.
Palantir’s AI Trading Draway
Palantir is the leader in publicly traded companies in providing products based on AI Technologies. It was founded in 2003 and opened in 2020. Many of its clients are Western governments. “Palantir has been an AI trading beloved since it launched in the first quarter of 2023, which has become Hyperdrive for the past two quarters,” Giarelli said.
AI trading initially focused on semiconductor manufacturers (particularly nvidia NVDA), in the third quarter of 2024, “the story began to emerge that software companies will become the ‘next foot’ of AI trading,” explains Giarelli. At the time, expectations were high for commodity within the physical supply chain to develop AI models. “As a result, economic value has begun to flow downstream to companies that “actually make AI work.” Palantir is perfectly positioned for this as it provides a large-scale language model with practical insights and the context required for optimized decision making. ”
Palantir’s revenues for the fourth quarter of 2024 then blew past expectations for revenue growth and margins. It has shown strong growth, particularly among its commercial clients in the US. “This is a company that takes pride in promoting exceptionalism for us, and this revenue report was proof of pudding,” says Gialeri. “Stocks were absolutely torn from $75 to $120.” By the end of 2024, inventory had grown about 340% in a year, but Morningstar US Technology Index It was just over 31%.
The rally continued this year. After the company reported revenue on February 3, it acquired 73% more US customers than a year ago, and 63% more US commercial revenues, with annual growth in US commercial revenue. On February 18th, it reached its highest ever-growing closing peak of $124.62.
Why does Palantir fall?
As soon as the stock recovers, the stock is returning almost every profit posted since February 3rd. One spark of the selloff came in the news that CEO and co-founder Alex Carp was about to sell more than 10 million shares after already making a massive sale of the stock in 2024. The next five years.
“It was a double wamy,” says Gialelli. “This can surprise investors as 40% of Palantir’s revenue comes from US government contracts and doesn’t like seeing CEOs sell their shares.”
Some theorize that wide shaking reflects aggressive trading of individual investors, rather than large institutional investors such as mutual funds and pension funds. However, Giarelli believes this may be changing. “Retail and institutional ownership is a hot button issue,” he says. In 2021, individuals held approximately 60% of Palantir stock, and were estimated to hold the institutions and the rest for less than quarter. Currently, estimates suggest that ownership is split evenly between individuals and institutions, with BlackRock and Vanguard being split between larger shareholders.
Palantir Technologies Stock Price
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What is the outlook for Palantir?
Giarelli calls himself a “big stock fan” from a basic perspective. Morningstar assigns a Palantil A narrow moat The rating means there are durable competitive advantages that can be maintained over the next decade. The rating is based on the company’s intangible assets, such as complex machine learning tools, and high switching costs that lead to strong customer retention.
Regarding concerns about government spending reversal, Gialelli sees Palantia’s positives and negatives. On the negative side, political pressure is being built to wander government spending. However, he says that “no software company has better equipment than Palantir to promote greater cost-effectiveness” for government spending.
For Giarelli, the most important thing is to expect the addressable total market for Palantir’s products and the penetration of that market. “These are the biggest factors in stocks, and investors need to think about it.”
The potential total addressable market is large, but so is the scope of the results. Giarelli says it can range from $1.2 trillion to $1.8 trillion. The Morningstar base case is a $1.4 trillion TAM. Given the size involved, he says, “$1.5 trillion vs. 1.8 trillion vs. 1.2 trillion makes a huge difference.”
Giarelli is optimistic about the Palantir’s potential to permeate this large market. He compares this possibility to Oracle. orcl 2010s and Salesforce CRM “But faster” from the late 2010s to the early 2020s. His model requires Palantir to record $40 billion in annual revenue by 2034. He thinks this is realistic. “We are taking into consideration the company’s trajectory and structural tailwinds, and we are directing towards agent solutions that will make AI work.”
Is Palantir stock worth buying, selling or quite a bit?
Palantir’s growth outlook may be strong, but valuation is an important variable for long-term investors. Giarelli pegs the fair value of the shares at $90 per share, making it a three-star stock. “The stock is valued pretty well at this point, and I think $90 investors are likely to receive fair, risk-adjusted returns close to the stock,” he says. He points out that stocks look “really expensive” when viewed in other metrics, such as revenues on enterprise value.
Investors should also consider the volatility of their stocks. “Not every investment is suitable for every investor,” he says. “Palantir investors should expect moderate to high levels of volatility as TAM and penetration expectations are frequently re-ricked. This is reflected in market prices, whether good or bad for the owner. That said, if you are bullish on the secular tailbone and believe that TAM is big, there is a very high chance that bull cases will emerge.” Such a result could potentially win $200 per share of stock north. “Or if TAM and penetration are disappointing, there could be an additional downside.”
Stock and Very high uncertainty assessmentthe band for that Star Rating It’s quite spacious. Palantir must fall below $72.40 per share before landing on undervalued territory. Giarelli says, however, that given the current outlook, if Palantir becomes a four-star stock, investors should “buy one from it.”
Below are some highlights of Giarelli’s outlook for Palantir and its inventory. The full report and much of his reporting is Available here.
Fair Value Estimates and Profit Drivers
Our fair value estimate of $90 means a 52-time Enterprise Value/Revenue in 2025. In our opinion, the main factor in the value of a stock is that Palantir’s software, which is ultimately an addressable market, can ultimately serve it. TAM size is really a trillion dollar question and unfortunately I have a hypothesis. In our basic case, Palantir’s TAM has grown to $1.4 trillion by 2033. From today, growth has been nonlinear, with high inflections to near 40% per year from 2028-30. Our analysis concludes that we are in the early innings of the AI revolution. In our basic case, Palantir expects to have a similar growth profile to innovative software companies like Salesforce in the late 2010s. Salesforce has been able to accelerate efficiency by creating standardized workflows and logging processes for bloated businesses with sales teams editing data in different locations. Palantir expects to promote efficiency as well among companies that rely on large information technology teams that interpret and present data to aid in decision-making.
Find out more about Giarelli’s analysis of Palantir’s fair value estimates here.
Palantir Technologies Stock vs. Morningstar Fair Value Quotation
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Economics
Palantir believes it will guarantee a narrow moat valuation based on switching costs and intangible assets. While companies like AWS, Snowflake, and ServiceNow have developed data analytics tools, Palantir distinguishes their status as the only AI company with a framework that organizes different data sets and drives optimized decision-making. This machine learning framework, which identifies opaque yet important relationships in data and transforms solutions to end users, is called an “ontology framework.” Palantir engineers read wide feedback loops that enable connectivity across your business, and creates accessible analytical frameworks to facilitate subtle decisions that improve over time. Palantir often competes with the Internal Information Technology department to analyze data and create information dashboards for interpretation. This traditional in-house IT and data aggregation framework often brings patchwork solutions that are tedious, difficult to improve, and costly to scale.
Find out more about Giarelli’s analysis of Palantir’s Economic Moat here.
Risk and uncertainty
Assign Palantir a very high Morningstar uncertainty rating. The company’s biggest uncertainty is the total address market, or the wide potential size of the TAM, which it can serve, and the level of customer penetration it can achieve.
We love the versatility of the ontology framework that makes Palantir software valuable to almost every company. This versatility creates significant rise possibilities. Unfortunately, TAM estimates are highly uncertain and are one of the biggest drivers of stock valuation, so downward stock adjustments can be serious and painful if there is a negative change in investors’ perception of future market size. We modeled multiple scenarios for future demand, but the scope of the resulting valuation is extreme, indicating the great uncertainty that investors face. If the TAM bear case emerges, the stocks will prove to be much less valuable than we expect.
Find out more about Giarelli’s analysis of Palantir’s risks and uncertainties here.
Pltr Bulls says
Palantir has developed the best AI software ready to take advantage of the trends towards digitalization and automation. AI software maintains its strategic position in the AI value chain. Palantir’s ontology framework and AI orchestration enable the democratization of machine learning. The software helps drive increased efficiency for employees at all levels of the business. With new bootcamp style sales efforts, Palantir has been able to achieve rapid growth in the US commercial segment. There is a large total livable market for commercial businesses in the US.
The Prittle Bears say
Palantir’s final market is limited to entities that combine with the Western spirit. This limits the entire addressable market. The reduced costs of AI inference and the convergence of LLMS reduces barriers to entry into the AI decision-making software industry, currently dominated by Palantir.
