Analyst updates Palantir stock price target

Bank of America Securities raised its price target for Palantir (PLTR) from $180 to $215, maintaining a "Buy" rating, citing stronger growth across applications and momentum from its Maven Smart System, recently adopted by NATO. This upgrade follows Palantir's first $1 billion quarterly revenue and a new strategic partnership with the UK Ministry of Defence, a five-year deal valued at up to £750 million. BofA now projects government sales to exceed $8 billion by 2030, increasing the 2025-2030 CAGR estimate to 30% from 27% previously, reflecting significant tailwinds from its expanding government contracts and AI-driven solutions.

Analysis

Bank of America has reiterated its conviction in Palantir (PLTR) by raising its price target to $215 from $180 while maintaining a 'Buy' rating, representing the second such upgrade in under two months. This increased optimism is underpinned by stronger growth across Palantir's applications and follows a period of significant momentum, which includes the stock soaring nearly 140% since January and the company's first-ever quarter with revenue surpassing $1 billion. Key drivers cited for the upgrade include major contract wins, notably the selection of Palantir’s Maven Smart System by NATO for intelligence and targeting, and a new five-year strategic partnership with the UK Ministry of Defence valued at up to £750 million. Based on this expanding government footprint, BofA has revised its long-term forecast, now projecting government sales to exceed $8 billion by 2030 and increasing its 2025-2030 compound annual growth rate (CAGR) estimate for the segment to 30% from 27%.

Key Decisions for Investors

• The reiterated 'Buy' rating, significant contract momentum with both NATO and the UK, and an upgraded long-term government sales CAGR to 30% provide a strong basis for a continued bullish thesis on PLTR, particularly for investors focused on AI and defense technology.
• Investors should monitor the execution and potential expansion of the £750 million UK Ministry of Defence contract and watch for further adoption of the Maven system by other allied nations, as these are the primary catalysts supporting the revised long-term growth forecasts.
• Given the stock's substantial 140% year-to-date rally, it is prudent to weigh the updated $215 price target against the current valuation to manage risk, as a significant portion of the positive AI-driven sentiment may already be reflected in the share price.