Palantir Technologies (PLTR) has been one of the standout AI stocks this year, climbing more than 119% so far. Strong Q3 results, rising demand for its AI platforms, and ongoing government contracts helped drive the rally. However, momentum has eased recently. The stock is down more than 9% over the past five sessions due to valuation concerns and renewed fears of an AI bubble. Still, Nvidia’s strong earnings and upbeat outlook have eased some of those concerns and may help sentiment in AI-related names in the near term.
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Amid this scenario, TipRanks’ AI Analyst Rina Curatex (under the OpenAI-4o model) turned more cautious. Curatex downgraded the stock from Buy to Hold and lowered the price target from $232 to $188, which implies only about 13.65% potential upside from current levels.
Palantir Stock Earns a Score of 69
According to TipRanks A.I. Stock Analysis, Palantir stock earns a score of 69 out of 100, reflecting strong financial performance, offset by bearish technical indicators and valuation concerns.
For context, TipRanks’ AI Stock Analysis delivers automated, data-driven evaluations of stocks based on key performance metrics, giving investors a clear and concise snapshot of a stock’s potential. Moreover, TipRanks’ A.I.-driven rating combines insights from multiple models, including OpenAI’s (PC:OPAIQ) GPT-4o and Google’s (GOOGL) Gemini, to offer investors a clearer view of a stock’s potential.
AI Analyst Weighs PLTR’s Strengths and Risks
The analysis pointed to both strengths and concerns for Palantir. On the positive side, revenue growth in the U.S. market remains strong, showing steady demand for Palantir’s software. The partnership with Nvidia (NVDA) is also seen as a plus, as it may help the company improve its AI tools and stay competitive. In addition, solid cash flow management gives Palantir flexibility to invest in new products and long-term growth opportunities.
However, the analysis also highlighted a few risks. The high P/E ratio of 391.3 suggests the stock may be overvalued, which could limit near-term upside and increase volatility. Also, slower international revenue growth was another concern, raising questions about how quickly Palantir can grow outside the U.S.
The report also mentioned legal challenges, which could add costs and pull management attention away from operations.
Is PLTR a Good Stock to Buy?
Currently, Wall Street has a Hold consensus rating on Palantir stock based on 11 Holds, three Buys, and two Sell recommendations. The average PLTR stock price target of $187.87 indicates a 13.57% possible upside from current levels.
