Analyst Sees Strong AI-Led Growth in Palantir (PLTR), Starts Buy

Core Viewpoint - Palantir Technologies Inc. is recognized as a significant player in the AI sector, with analysts highlighting its strong growth potential driven by AI adoption and a robust market position in the U.S. [1] Group 1: Revenue Growth - The company anticipates group revenue to grow 47% year on year, reaching $4.2 billion in FY25, with commercial revenue expected to increase by 51% compared to government revenue growth of 43% [2] - U.S. growth, which constitutes 66% of Palantir's revenue, is projected to accelerate by 66% year on year in FY25, supported by government demand and increasing intelligence spending [3][4] Group 2: Profitability - Net profit is forecasted to nearly double in FY25, reflecting strong demand from both government and commercial sectors [3] Group 3: Market Position and Valuation - The firm initiated coverage with a DCF-based target price of $208, supported by a WACC of 8.3%, a risk-free rate of 4.2%, and a terminal growth rate of 8% [5] - The forward P/E ratio is noted to be 170x as of January 16, 2026, indicating potential for a rerating based on improving fundamentals and a growing addressable market [5]