TLDR
- Palantir stock hit record highs before pulling back to $181.09, down 1.78% as investors debate its sky-high valuation
- Jim Cramer predicts $200 price target while Citron Research warns the stock isn’t “easy money” at current levels
- Company crossed $1 billion quarterly revenue milestone for first time with 48% growth in Q2 2025
- Both commercial (93% growth) and government (53% growth) segments delivered strong performance
- Stock trades at P/E ratio over 800 with $429 billion market cap, making it best S&P 500 performer this year
Palantir Technologies stock has become the center of heated debate after hitting record highs this week. The data analytics company closed Wednesday at $181.09, down 1.78% from its peak.
The stock surge followed stellar second quarter results that showed the company crossing the $1 billion quarterly revenue mark for the first time. Revenue jumped 48% year-over-year in Q2 2025.
CNBC’s Jim Cramer sparked controversy by predicting the stock could reach $200. He told investors on X they wouldn’t have to “wait too long” for further gains.
His comments drew sharp criticism from Andrew Left’s Citron Research. The firm questioned when Cramer “pivoted from market commentator to full-blown stock promoter.”
Citron called Palantir at current levels a “high-multiple, hype-driven narrative” rather than easy money. The research firm warned investors about the stock’s valuation risks.
Left appeared on Fox News Wednesday to discuss his short position in the company. He called Palantir a “great” company but expressed concern about its pricing.
Revenue Growth Drives Investor Interest
The company’s financial performance has been the main driver behind investor excitement. Palantir reported $326.7 million in GAAP net income for Q2, more than double the previous year.
Management raised full-year revenue guidance to $4.14-4.15 billion. This reflects confidence that growth momentum will continue through 2025.
The commercial segment has been particularly strong. U.S. commercial revenue grew 93% year-over-year, now accounting for about 30% of quarterly revenue.
Recent commercial wins include a multi-year partnership with Fannie Mae. The company also secured a health care rollout with The Joint Commission.
The commercial segment secured $843 million in contract value during the quarter. This brings remaining deal value to $2.8 billion.
Government Contracts Provide Stability
While commercial growth grabs headlines, government contracts remain crucial for Palantir. U.S. government revenue grew 53% from the previous year.
The Pentagon recently expanded Palantir’s Maven Smart System contract to $1.3 billion. The original $480 million deal was increased with a ceiling extending through 2029.
Government contracts provide stability while commercial expansion offers faster growth. This dual approach reduces dependence on any single customer or industry.
The public sector’s adoption of AI technologies has boosted demand for Palantir’s services. Defense spending on AI capabilities continues to grow.
Left suggested a more rational valuation for the stock could be $65 or $70. He said current ratios have become “so absurd” he stopped looking at them.
The Koyfin-compiled consensus price target stands at $149.27. This implies 19% downside from current trading levels.
Palantir currently trades at a price-to-earnings ratio over 800. The company’s market capitalization has reached $429 billion.
Despite valuation concerns, the stock has gained 144% this year. It ranks as the best performer on both the S&P 500 and Nasdaq.
On Stocktwits, retail sentiment shifted from bullish to neutral by late Wednesday. Message volume remained at normal levels.
Some analysts predict Palantir could reach a $1 trillion market capitalization. This would require continued strong execution and market expansion.
The company’s transformation from government contractor to diversified AI leader continues gaining traction. Both revenue segments are delivering strong growth as management raised full-year guidance to reflect sustained momentum.
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