Palantir stock investors just got some great news from Wall Street

• Bank of America’s Mariana Perez Mora recently raised her price target on Palantir to $215 per share, implying a 17% upside from the current share price of $183.

• Mora says Palantir’s forward-thinking engineers and ontology-based software are key differentiators that should give the company a competitive edge.

• Palantir is a recognized leader in artificial intelligence and machine learning platforms, but it is also the most expensive stock in the S&P 500 by a wide margin.

• 10 stocks we like better than Palantir Technologies ›

Palantir Technologies (NASDAQ:PLTR) is one of the most popular artificial intelligence (AI) stocks on the market, especially among retail investors. Shares are up 140% year to date, after rising 340% last year. And the company recently got a big vote of confidence from a Wall Street analyst.

Mariana Perez Mora, responsible for aerospace and defense at Bank of Americarecently raised its price target from $180 per share to $215 per share. Mora’s forecast is now the most bullish on Wall Street and implies a 17% upside from the current share price of $183.

Here’s what investors need to know about Palantir.

In her recent note, Bank of America analyst Mariana Perez Mora highlighted two qualities that set Palantir apart. First, the company uses forward-deployed engineers (FDEs), developers who work directly with specific customers to build custom solutions. FDEs are a particularly attractive value proposition as more companies look to integrate artificial intelligence into workflows.

Second, Palantir designed its software around an ontology, a framework that serves as an organization’s digital twin. Think of an ontology as a cause-and-effect diagram that uses digital information to define the relationship between physical objects. This allows customers to easily solve, automate and optimize business processes with artificial intelligence.

In short, while most analytics tools are built around data, Palantir has designed its software around a decision-making framework. Chief Technology Officer Shyam Sankar told analysts on the company’s second-quarter earnings call: “Our foundational investments in ontology and infrastructure have uniquely positioned us to meet AI demand.”

Indeed, Forrester research ranked Palantir as a Technology Leader in its most recent Artificial Intelligence and Machine Learning (ML) Platforms Report, awarding its AIP platform higher scores than comparable products from Amazon, MicrosoftAnd Alphabet. And IDC ranked the company as a market leader in its latest decision intelligence software report.

Palantir currently earns the majority of its revenue from government customers, and that business segment has regained momentum thanks to demand for AI in defense and intelligence agencies. Government revenue growth has accelerated for six consecutive quarters and adoption is also expanding outside the US

NATO earlier this year acquired Palantir’s Maven Smart System, an AI-powered war platform already used by the US military to improve battlefield targeting and supply chains. More recently, Palantir signed a five-year, £750 million deal with the UK Ministry of Defense to help the British military develop AI capabilities. That is the largest government contract to date outside the US.

Mora at Bank of America thinks the momentum will continue as more countries consider the Maven Smart System. She estimates that government revenues will reach $8 billion annually by 2030. However, Mora expects commercial revenues to exceed that figure and reach $10 billion by the end of the decade as companies choose to buy Palantir’s AI operating system rather than building their own.

In summary, Mora believes that demand for artificial intelligence will be a major catalyst for Palantir, driving its total revenue to $18 billion per year by 2030. To put that in context, the company reported $3.4 billion in revenue over the last twelve months, so its forecast implies revenue growth of 35% per year over the next five years.

Palantir is well positioned for future growth. Grand View Research estimates that the data analytics market will grow 29% annually through 2030, driven by demand for artificial intelligence and machine learning tools. As a leader in decision intelligence software with deep expertise in AI/ML, Palantir is likely to report faster revenue growth than the overall market.

However, that still does not justify the current valuation of 134 times sales. For context, the next closest stock in the S&P500 is Applovin with a price-to-sales ratio of 39. That means Palantir could lose 70% of its market value and still be the most expensive stock in the index.

Consider this scenario: If Bank of America is right in predicting $18 billion in revenue by 2030, Palantir would still be trading at 24 times revenue at that point if its stock price doesn’t change at all. Only eight stocks in the S&P 500 currently have valuations above 24 times sales, so Palantir would still be one of the most expensive stocks in the index (by today’s standards) without any price appreciation over the next five years.

The bottom line: Palantir is an excellent company, but its stock is vastly overvalued. That doesn’t mean stocks will fall anytime soon. Palantir could very well hit Mora’s price target of $215 per share. But the risk-reward profile is undoubtedly skewed to the downside, so investors should choose wisely and look elsewhere. There are plenty of other AI stocks with a more favorable risk-reward profile.

Consider the following before purchasing shares in Palantir Technologies:

The Motley Fool stock advisor The analyst team has just identified what they think is the 10 best stocks for investors to buy now… and Palantir Technologies wasn’t one of them. The ten stocks that survived the cut could deliver monster returns in the coming years.

Think about when Netflix made this list on December 17, 2004… if you had $1,000 invested at the time of our recommendation, you would have $642,328!* Or when Nvidia created this list on April 15, 2005… if you had $1,000 invested at the time of our recommendation, you would have $1,134,270!*

It’s worth mentioning Stock Advisors the total average return is 1,064% – a market-crushing outperformance compared to 191% for the S&P 500. Don’t miss the latest top 10 list, available at Stock Advisorand join an investment community built by individual investors for individual investors.

View the 10 stocks »

*Stock Advisor returns October 7, 2025

Bank of America is an advertising partner of Motley Fool Money. Trevor Jennewine has positions in Amazon and Palantir Technologies. The Motley Fool holds positions in and recommends Alphabet, Amazon, Microsoft and Palantir Technologies. The Motley Fool recommends the following options: long January 2026 $395 calls to Microsoft and short January 2026 $405 calls to Microsoft. The Motley Fool has a disclosure policy.

Palantir Stock Investors Just Got Some Great News from Wall Street was originally published by The Motley Fool