Palantir Technologies (PLTR) is expected to post improved profitability in its fourth-quarter earnings report, with analysts predicting adjusted earnings of 11 cents per share, up 39% from the same period last year. Revenue growth is also forecasted at 28%, reaching $776 million. The company’s U.S. commercial revenue is predicted to climb 52% to $199 million.
The Q4 earnings setup may be challenging, as PLTR will be lapping easy comparisons, and any signs of non-accelerating growth could lead to multiple compression. However, Wall Street analysts remain optimistic about Palantir’s prospects, with Daniel Ives maintaining an out-perform rating. He attributes the company’s success to its game-changing Artificial Intelligence Platform strategy.
Palantir’s “forward deployed engineers” approach, where its workers are placed inside customer locations to help develop AI projects and turn them into commercial deployments, has also been praised by analysts. For 2025, Wall Street analysts project 24.6% revenue growth to $3.5 billion.
The company’s post-election rally may be attributed to views that artificial intelligence will play a bigger role in homeland security or defense spending. Palantir has provided data analytics tools to government customers for intelligence gathering, counterterrorism, and military purposes. Now, the company aims to use generative AI to spur growth in the U.S. commercial market.
In a recent development, Palantir is in talks to invest in drone and software maker Shield AI in its next funding round, according to The Information. Additionally, the federal government has given Palantir a higher rating for secure cloud computing services. These developments suggest that Palantir remains a key player in the defense industry.
However, some analysts have raised concerns about Palantir’s valuation and revenue growth prospects. The company’s P/E ratio is relatively high, and some experts predict that most software makers will not monetize generative AI until late 2025 or 2026.
Despite these challenges, Palantir’s Relative Strength Rating stands at 99 out of a best-possible 99, indicating strong technical performance. The company’s Composite Rating also holds a rating of 99 out of a best-possible 99, according to IBD Stock Check-up. Investors can sign up for news alerts from Palantir investor relations department here or check out IBD Stock Lists and other IBD content to find dozens more of the best stocks to buy or watch.
Source: https://www.investors.com/news/technology/pltr-stock-buy-now