Palantir (PLTR) stock’s up an incredible 106% year to date, but that leaves investors wondering how much gas is left in the tank.
Veteran Wall Street research firm Loop Capital just answered that question with a bold new target, and the logic goes beyond earnings beats.
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Loop Capital sees something brewing under the surface, leaning into control, momentum, and a long-term edge in AI that no one’s talking about.
If anything, the bar just got higher, and Palantir’s AI hype train isn’t likely to slow down anytime soon.
Loop Capital makes a bold move on Palantir with a new $178 target.
Image source: Bloomberg/Getty Images
Palantir’s AI edge isn’t the models, it’s what makes them work
Palantir isn’t looking to go toe-to-toe with ChatGPT, Google’s Gemini, or Grok on base models.
Its strength lies in what comes after, where operational layers turn those models into robust, usable, high-stakes tools.
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At the heart of it all is AIP, Palantir’s potent Artificial Intelligence Platform.
Built into its powerful Foundry software and closely integrated Gotham and Apollo platforms, AIP essentially gives clients a “control plane” for AI.
That effectively gives them access to robust large language models (LLMs) and multimodal AI, bespoke agents, while constantly testing performance.
This one-stop shop setup takes raw AI output into decision-grade actions. For enterprise and government clients, that’s what transforms a base model from experimentation into a real-world deployment.
Take the partnership with Microsoft, for instance.
Palantir layers its comprehensive governance tools on top of Microsoft’s cloud behemoth, even inside classified defense environments.
That allows U.S. intelligence agencies to run sensitive AI workloads with full oversight efficiently.
Then you have Palantir’s forward-deployed engineers, who embed clients with customized AI workflows to accelerate adoption.
Strategic alliances with Databricks and Accenture Federal Services help Palantir spread its tentacles even more, enabling real-time, autonomous decision-making in both commercial and federal settings.
Moreover, with multi-hundred-million-dollar Department of Defense deals under its belt, Palantir’s position as the “AI control layer” is essentially mission-critical.
Loop Capital lifts Palantir price target to $178 on AI strength
Palantir Technologies just got a massive price target bump.
Loop Capital’s Mark Schappel raised his price target to $178 from $155, reaffirming a Buy rating.
The move comes just days ahead of Palantir’s Q2 earnings report on August 4, which Schappel expects will be another quarter of outperformance in both sales and guidance for the AI software firm.
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Also, Schappel is modeling more upside in line with Palantir’s recent beats, roughly 4.3% above guidance. He also expects the business to raise forward-looking numbers in the process.
However, with the stock’s blistering rally, where it’s up 106% this year and 26% since Q1 earnings, it adds to the tension.
However, Schappel believes it not only can keep going, but also may just be getting started.
A big part of that is Palantir’s multifold AI edge.
It sits quietly at the intersection of AI and enterprise software, with powerful commercial tailwinds and a deep federal bench.
This includes ties to Trump-aligned policy shifts linked with defense and digital modernization.
AI adoption is expanding across multiple sectors, and Palantir is moving quickly in converting pilot deals into powerful production contracts.
On top of that, the company posted a “Rule of 83” in Q1, a feat few companies in tech can match.
To put things in perspective, the Rule of 83 is just its Rule of 40 score hitting 83%, which is essentially the sum of YOY revenue growth rate and adjusted operating margin (that sits well above the 40%).
Veteran fund manager of TheStreet portfolio Chris Versace, though, has a different take on Palantir stock.
He feels Palantir is bumping up against his price target, and recent trade developments and defense spending impacts have him revisiting his take.
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He’s already raised the panic point to $115 and set a pick-up at $137, which indicates that the stock is extended in an overbought market (considering it’s trading at $158.61). Hence, it implies locking gains or waiting for a pullback before loading up more.
Q2 earnings preview: Palantir must clear a high bar to keep rally alive
Veteran investors are eyeing what could be a big step up heading into Palantir’s Q2 print.
The company had a standout Q1, where sales surged 39% YOY to $884 million, with U.S. revenue alone jumping 55% and U.S. commercial business growing 71%.
That strength has led the management to bump its full-year revenue guidance to $3.89–$3.90 billion.
Executives leaned hard into Palantir’s powerful AI Platform and its durability amid scrutiny over U.S. defense spending.
Consequently, Q2 expectations have climbed immensely.
Mr. Market is now modeling $939.47 million in sales, a 38% YOY jump, alongside 56% EPS growth to 14 cents on a non-GAAP basis.
For context, it posted a Q2 2024’s beat of $678.13 million and 9 cents EPS.
The implication is that Palantir must continue delivering superb results across commercial and federal pipelines, as it comes up against steep comps.
Over the past 90 days, analysts have effectively revised earnings estimates 12 times higher and just three times lower, reflecting superb confidence.
Those upgrades stem from stronger visibility into contract wins, scaling AI deployments, and healthy upside from federal defense initiatives.
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