Palantir Technologies (NASDAQ:PLTR) has been a hot topic in the world of enterprise AI trading. Despite experiencing a significant pullback in the first half of the year, our proprietary model suggests that the bullish trend may be making a comeback. With shares currently sitting at $129.30 as of July 2, our 24/7 Wall St. price target for Palantir is set at $161.53 over the next 12 months, indicating a potential upside of 24.93%. We are confident in our recommendation to buy, with a high level of confidence at 90%.
The Path Back to $129
Palantir has had a rollercoaster ride in 2026, with the stock seeing a 27.26% decline year-to-date after reaching a peak of $207.52. However, there has been a recent rebound of 20.54% in the past week from a low of $106.37. Despite the volatility, the company’s fundamentals continue to strengthen.
In Q1 2026, which was reported on May 4, PLTR delivered adjusted EPS of $0.33, surpassing the $0.28 consensus, with revenue reaching $1.632 billion, marking an 84.7% year-over-year increase, the highest growth rate in the company’s history. U.S. commercial revenue saw a significant surge of 133% to $595 million, leading management to raise full-year revenue guidance to $7.65 to $7.66 billion.
The Case for $200+
Bullish investors have reason to be optimistic, with Palantir’s Rule of 40 score hitting 145%, a level that CEO Alex Karp compared to other AI infrastructure companies like NVIDIA, Micron, and SK Hynix. The company’s U.S. commercial remaining deal value rose to $4.92 billion, a 112% increase, and PLTR closed 47 deals worth $10 million or more in the quarter. Adjusted operating margin expanded to 60%, and free cash flow surged by an impressive 204% to $924.6 million.
The Street’s consensus target of $183.12, along with 20 Buy or Strong Buy ratings, supports the view of further growth. Our bull-case scenario places PLTR at $203.24 within a year if the adoption of Artificial Intelligence Platforms (AIP) continues to grow.
What Could Go Wrong
The primary risk for Palantir lies in its valuation, as the company currently trades at a trailing P/E of 145 and a forward P/E of 89, with a price-to-sales ratio of 59. Criticisms from individuals like Michael Burry, who labeled Palantir as “A Sand Castle Supported Only By AI Applications Narrative,” have fueled bearish sentiments.
Looking Ahead
As we anticipate Q2 earnings, our price target of $161.53 and buy rating reflect the company’s potential for hypergrowth and cash generation. It will be crucial to monitor the 50-day moving average of $134.58 leading up to the earnings report, where revenue is expected to reach $1.797 to $1.801 billion.
In conclusion, while there are risks associated with Palantir’s valuation, the company’s strong fundamentals and growth potential offer a promising outlook for investors. As always, it’s important to stay informed on any developments that may impact the stock’s performance.
