Palantir Technologies (NASDAQ: PLTR) continues its bullish run in 2024, with its stock price climbing 29% year-to-date. The surge comes on the back of rising government contracts, robust performance from its U.S. commercial business, and the successful expansion of its AI-powered Workflow Builder platform.
Palantir Stock Hits $88.05 Amid Strong Growth
On Thursday, Palantir’s stock traded at $88.05, marking a 2.27% increase on the day.
- Day’s Range: $85.12 – $88.49
- 52-Week Range: $20.33 – $125.41
- Market Cap: $202 billion
- Gross Margin: 80.25%
Palantir’s Revenue Growth Accelerates
After experiencing slower growth in 2022 and 2023 due to lumpier government contracts and macroeconomic headwinds, Palantir rebounded strongly in 2024.
- Revenue grew by 29% in 2024, accelerating from 17% growth in 2023.
- The company stayed profitable on a GAAP basis for the second consecutive year.
- Rising profitability led to Palantir’s inclusion in both the S&P 500 in September and the Nasdaq-100 in December.
Government Contracts Drive Revenue Spike
Palantir’s recent growth is largely fueled by surging U.S. government contracts amid rising geopolitical tensions in Europe and the Middle East.
- The company’s Gotham platform, which serves clients such as the CIA, FBI, and Department of Defense, benefited from increased defense spending.
- The U.S. government has ramped up investments in AI-powered defense and intelligence systems, providing Palantir with larger contracts.
Commercial Expansion Powers Domestic Gains
While Palantir’s overseas expansion remained sluggish, its U.S. commercial business saw strong momentum.
- The company’s Foundry platform, which serves corporate clients such as Morgan Stanley and Airbus, witnessed rising demand for its AI data analytics solutions.
- Palantir’s Workflow Builder expansion allowed clients to create their own AI-powered apps, actions, and agents, driving further adoption across its ecosystem.
Analysts Forecast Explosive Growth Through 2027
Looking ahead, analysts expect Palantir’s revenue and EPS to continue growing at a rapid pace despite ongoing federal cost-cutting measures under the Trump administration:
- Revenue Growth (2024-2027): +31% CAGR
- EPS Growth (2024-2027): +57% CAGR
High Valuation Poses a Potential Risk
Despite its promising growth trajectory, Palantir’s stock valuation is stretched at current levels:
- Forward P/E Ratio: 282x earnings
- Next Year’s Sales Multiple: 53x revenue
- Such lofty valuations could cap the stock’s upside potential, making it vulnerable to a sharp pullback during a broader market correction or economic downturn.
Palantir’s Bright AI-Powered Future
With its Gotham and Foundry platforms driving revenue growth and AI expansion fueling its commercial business, Palantir remains a dominant force in the AI and big data analytics sector. However, its high valuation may deter some investors from buying in at current levels, prompting a more cautious, long-term accumulation strategy.
