TSX runs higher on rate cut expectations
Investing.com-- Mizuho (NYSE:MFG) analysts nearly doubled their price target on Palantir Technologies Inc (NASDAQ:PLTR), following the company’s blockbuster fourth-quarter results that significantly outperformed expectations.
Mizuho raised PT to $80 from $44, but maintained its "Underperform" rating citing concerns over the stock’s stretched valuation.
Palantir reported $828 million in fourth-quarter revenue, a 36% year-over-year increase, well above Wall Street’s forecast of $776 million, analysts said.
Growth was driven by strength in both U.S. Commercial and U.S. Government segments, with government revenue surging 40% to $455 million, while commercial revenue grew 31% to $372 million, both exceeding estimates, they stated.
Mizuho analysts noted that management provided strong 2025 guidance, forecasting $3.741 billion-$3.757 billion in revenue, implying 31% growth, which is significantly higher than the 26% growth expected by consensus.
The company also guided for first-quarter revenue of $858 million-$862 million, 7%-8% above analyst projections.
Despite these positive results, Mizuho expressed concerns over Palantir’s valuation, which has surged in recent months.
At an after-hours price of $104, Palantir is trading at 69x its 2025 estimated revenue and 56x its 2026 revenue forecast, analysts wrote.
While Palantir’s execution and positioning remain impressive, analysts find it exceedingly difficult to justify its current multiple, which already prices in significant acceleration beyond consensus expectations, they said.
Mizuho concluded that while the company’s AI-driven growth is a key strength, valuation remains a major concern, preventing an upgrade despite raising earnings estimates for 2025-26.