TLDR
- Palantir Technologies (PLTR) stock surged 340% in 2024 but has recently fallen 30% from its February peak of $124.62 to $86.24
- The company reported strong Q4 2024 results with revenue of $828 million (36% year-over-year increase) and exceeded analyst expectations
- Palantir announced a strategic joint venture with TWG Global to enhance AI deployment in financial services
- Loop Capital analyst Mark Schappel lowered his price target from $141 to $125 but maintained a buy rating
- The broader market has faced volatility with major indices dropping, but Palantir’s financials remained resilient compared to tech peers
Palantir Technologies, the software company specializing in data analytics and artificial intelligence, has experienced a significant market correction recently despite posting strong financial results. The company’s stock has fallen 30% from its February peak, mirroring broader market volatility.
In early February, Palantir reported fourth-quarter results that exceeded Wall Street expectations. The company posted adjusted earnings of 14 cents per share, surpassing the consensus estimate of 11 cents.
Revenue for the quarter reached $828 million, representing a 36% increase year-over-year and beating analyst projections of $776 million. For the full year 2024, revenue grew 29% to $2.87 billion.
U.S. revenue surged 52% year-over-year to $558 million, with commercial revenue climbing 64% to $214 million. These figures highlight Palantir’s strong domestic growth and increasing commercial adoption.
The company demonstrated robust deal-making capacity by closing 129 deals worth at least $1 million. This included 32 deals exceeding $10 million, further showcasing enterprise confidence in Palantir’s offerings.
Cash generation remained strong with Palantir reporting $460 million in cash from operations. Free cash flow reached $517 million, reflecting the company’s healthy operational efficiency.
Stronger-than-expected guidance
Following the earnings announcement, Palantir provided stronger-than-expected guidance for 2025. The company forecast sales between $3.74 billion and $3.76 billion, exceeding the average analyst estimate of $3.52 billion.
Palantir CEO Alex Karp noted, “Our early insights surrounding the commoditization of large language models have evolved from theory to fact.” This statement underscores the company’s strategic positioning in the rapidly evolving AI landscape.
Despite these positive indicators, Palantir stock has pulled back from its closing peak of $124.62 on February 18 to $86.24. This 30% decline has been attributed to Pentagon budget cuts, CEO Alex Karp’s stock-sale plan, and the broader market correction.
Analyst lowers price target
Loop Capital analyst Mark Schappel recently lowered his price target on Palantir from $141 to $125. However, he maintained a buy rating, identifying Palantir as an early software leader in enterprise artificial intelligence.
According to Loop Capital, enterprise AI is at a “tipping point” as small-scale pilot programs move into production and AI use cases grow exponentially across industries. This trend potentially positions Palantir for continued growth despite recent stock performance.
In a strategic move, Palantir recently announced a joint venture with TWG Global. This partnership aims to revolutionize AI deployment in financial services, banking, investment management, and insurance sectors.
The collaboration combines Palantir’s AI infrastructure with TWG’s expertise in business operations. The venture is being led by Palantir CEO Alex Karp and AI veteran Drew Cukor, former JPMorgan AI head and Pentagon’s Project Maven leader.
Challenging times for technology stocks
The broader market context has been challenging for technology stocks. The Nasdaq Composite has dropped 11% over the past month, with a 4% decline on March 10 alone – its steepest single-day decline since September 2022.
While some market analysts have attributed this selloff to uncertainty about President Trump’s tariffs, Dan Niles of Niles Investment Management suggests it’s driven by revenue estimates for major tech companies rather than tariff concerns.
According to Niles, “It’s not the tariffs knocking these tech stocks down. It is the fact that revenue estimates for six out of the seven biggest in the [Magnificent 7 tech stocks] all went down for Q1 after reporting Q4.”
Palantir’s financial resilience stands in contrast to many of its tech peers during this market correction. The company’s stock had surged 340% in 2024 before the recent pullback, fueled by increasing demand for AI software.
As of the latest reports, Palantir has 64 hedge fund holders, making it the 4th most active US stock according to hedge fund interest. This institutional backing may provide some stability as the market navigates current volatility.
Trading volume for stocks like Palantir remains robust despite market uncertainty. According to World Bank data, the total value of stocks traded in the U.S. increased from approximately $36.3 trillion in 2019 to over $44.3 trillion in 2022, reflecting the market’s growth over recent years.
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