Palantir (NASDAQ:PLTR) stock has its roots in a company unafraid to challenge the status quo, even when that meant taking on the U.S. Army. In 2016, Palantir filed a lawsuit arguing that the Army had violated federal law by building its own battlefield intelligence system rather than evaluating commercial alternatives like Palantir’s. The company ultimately won the case, setting a key precedent that government agencies must give serious consideration to existing commercial technologies before developing their own.
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That rebellious spirit, says Piper Sandler analyst Brett Bracelin, exemplifies Palantir’s “unconventional journey.”
“The 22-year path to a ~$4 billion revenue run-rate with 40%+ FCF margins has been a long road travelled,” the analyst went on to say. “While the culture, leadership, and journey may be unconventional, the impact in the AI revolution could be lasting.”
Bracelin speaks from experience, having followed Palantir for more than five years – from its days as a buzzy late-stage private firm, through its direct listing in 2020, and into the stock’s sharp decline in late 2022, when confidence in its long-term 30%+ growth ambitions faded and shares dropped to around $6. Yet, it’s precisely this unpredictable trajectory that makes Palantir’s comeback so compelling. Since that slump, the company has pulled off what Bracelin calls a “’rise of the phoenix’ moment,” reemerging as an “AI All-Star” on the strength of accelerating growth.
While the stock isn’t cheap – and still carries high risk – Bracelin argues it offers a “one-of-a-kind growth+margin model” that could support a path to $24 billion in annual revenue by 2032, assuming it continues to expand in both the defense industry and the enterprise software sector – markets each worth over $1 trillion.
In the government space alone, Bracelin sees potential for more than $10 billion in annual revenue by 2030, driven by a projected 36% compound annual growth rate (CAGR). That optimism is rooted in Palantir’s proven 35% CAGR since 2018, a steady stream of new contracts with agencies like the Army, DoD, and Fannie Mae, and broader secular shifts in defense spending toward AI-powered software. The analyst also notes the strengthening ties between Palantir and traditional defense primes, which are evolving into strategic allies rather than competitors.
But Palantir’s growth story isn’t confined to government contracts. Bracelin also highlights the U.S. commercial segment as a major opportunity, with revenues potentially growing at a 33% CAGR to surpass $5 billion by 2030. Key to this trajectory are partnerships with enterprise heavyweights like Accenture, Databricks, and SAP – and a growing footprint across industries ranging from finance to healthcare.
Still, even the strongest bull case must reckon with valuation. Palantir’s enterprise value to free cash flow (EV/FCF) multiple is sky-high – above 200x based on 2026 estimates.
“That said,” Bracelin noted, “PLTR growth and margin metrics are in a class of one and if adoption continues to broaden, the bull-case of 30%+ compound growth and 40%+ FCF margin becomes more achievable, in our view.”
In short, Bracelin sees Palantir as an “AI secular winner” and has initiated coverage with an Overweight (i.e., Buy) rating. But while his Street-high $170 price target leads the pack, it implies only a modest 7% upside from current levels – a far cry from the triple-digit surge the stock has delivered over the past two years. (To watch Bracelin’s track record, click here)
And while Bracelin is firmly in the bull camp, the broader Street remains cautious. Palantir currently holds a Hold (i.e., Neutral) consensus rating, based on 10 Holds, 4 Buys, and 3 Sells. The average price target of $109.50 suggests shares could retreat 31% over the next 12 months. (See PLTR stock forecast)
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Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.