BofA lifts Palantir stock price target to $125, maintains buy

Published 04/02/2025, 12:12
BofA lifts Palantir stock price target to $125, maintains buy

On Tuesday, BofA Securities analyst Mariana Perez Mora updated her assessment of Palantir Technologies Inc . (NASDAQ:PLTR), increasing the price target significantly to $125 from the previous $90, while reaffirming a Buy rating on the stock. The adjustment reflects a shift in valuation methodology, now focusing on a long-term outlook rather than near-term sales growth. The stock has shown remarkable momentum, with InvestingPro data showing a 392% return over the past year and currently trading near its 52-week high of $85.22.

Mora’s new price objective is based on a 15x EV/EBITDA multiple applied to the company’s projected financials for 2035. The long-term valuation approach is adopted to better represent Palantir’s enduring high-growth and profitability potential, supported by its impressive 81.1% gross profit margin and 24.52% revenue growth in the last twelve months. The analyst’s updated price target also suggests a 1.8x EV/Sales/Growth multiple for the year 2026, positioning it at the upper end of the spectrum for profitable software infrastructure and industrial automation companies, which typically range between 0.5x and 1.9x. According to InvestingPro, the stock currently trades at elevated multiples, with a P/E ratio of 389x and an EV/EBITDA of 469x, suggesting investors are pricing in significant future growth. For deeper valuation insights and 18 additional ProTips, consider exploring the comprehensive Pro Research Report available on InvestingPro.

The bullish stance is further supported by Palantir’s distinct market position amid an increasingly competitive artificial intelligence sector. The analyst highlighted Palantir’s focus on making data operational, creating high-fidelity digital enterprise-twins, and enhancing the speed of decision-making as key factors that set the company apart from providers of more commoditized AI solutions.

Mora expressed confidence that the market will continue to reward AI companies that add significant value rather than those distributing commodity products. With a closing after-hours share price of $102, the new price target represents a notable increase and underscores the analyst’s expectation for Palantir’s growth to accelerate meaningfully in the coming years.

In other recent news, Palantir Technologies Inc. has seen several significant adjustments in stock price targets following robust financial results. HSBC recently raised their price target for Palantir from $38 to $96, following the release of their first-quarter results for 2025 and full-year guidance, which surpassed expectations. Similarly, Mizuho (NYSE:MFG) Securities raised its price target for Palantir to $80, while RBC increased its price target to $40, both firms maintaining an underperform rating. Cantor Fitzgerald also raised its price target for Palantir to $98, with UBS increasing its target to $105, both firms maintaining a neutral rating on the stock.

These adjustments follow Palantir’s strong financial performance, with a reported year-over-year revenue growth of 36% for the first quarter and 31% for the full year of 2025. The company also expects non-GAAP operating profit to grow by 57% in the first quarter and 38% throughout 2025. Despite the strong performance, HSBC analysts expressed concerns about the stock’s high valuation.

Palantir also secured a significant contract with the U.S. Army, valued at approximately $400.7 million. This recent development underscores the dynamic performance and growth prospects of Palantir Technologies. Despite the positive financial performance and raised price targets, most firms, including Raymond (NSE:RYMD) James, maintained a neutral rating on the stock, indicating a cautious stance on its current valuation.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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