There’s so much hype around Palantir (ticker: PLTR) that we simply couldn’t pass it up. This company develops solutions for Big Data processing and artificial intelligence. In the early days, Palantir took on contracts for U.S. intelligence agencies. Now it spans a wide range of industries—from banking to healthcare. Below, we’ll go over the current stock price, revisit the Q4 earnings report, evaluate PLTR’s prospects and risks, and try to answer the big question: Is Palantir a Good Stock to Buy or better to sell?
What Happened to PLTR in the Second Half of February 2025?
As of the latest update (evening of February 21), PLTR has dropped about 15% over the past week. By the close of trading on February 21 (Friday), the stock was hovering around $101, bringing its market capitalization down to $237.7 billion.
According to Barron’s and other sources, PLTR lost 15% in just two days. Some analysts believe this isn’t just a short-term dip but could be a sign of a broader correction. That said, despite the recent slide, Palantir is still up 34% year-to-date, making it the third-best performer in the S&P 500 so far in 2025.
Top 3 Reasons Investors Are Concerned in Late February 2025
1. CEO Alex Karp’s plan to sell up to $1.2 billion worth of shares. For the market, this move signals that top management might be locking in profits and doesn’t expect a sharp upside in the near term.
2. Warnings from President Donald Trump’s administration about potential budget cuts in the U.S. Department of Defense. Palantir has several major military contracts, so any reduction in government spending could directly impact its revenue.
3. Concerns about Palantir’s valuation. Many investors have been questioning whether the stock is overheated. There are growing doubts about whether PLTR’s current price truly reflects its future growth potential.
Palantir (PLTR) Q4 Earnings Report
On the evening of February 3, 2025, Palantir Technologies (PLTR) released its Q4 2024 earnings report, exceeding analyst expectations. Revenue surged 36% year-over-year, reaching $828 million, well above the $776 million consensus estimate. As expected, PLTR shares jumped 22% following the report.
Palantir also provided its 2025 outlook, forecasting Q1 revenue between $858 million and $862 million, significantly higher than analysts’ expectations of $799 million. Additionally, Palantir (PLTR) saw strong growth in the U.S. market, both in the commercial and government sectors. Commercial revenue increased 64% year-over-year. U.S. government contracts grew 45% compared to the previous year. Total revenue for 2024 increased 29%.
Palantir’s Growth Potential: Is Palantir a Good Stock to Buy?
A major part of Palantir’s success comes from its core products: Gotham (for government clients), Foundry (for commercial clients), and Apollo (which ensures continuous software updates). Palantir delivers a comprehensive ecosystem that enables real-time data processing. For corporations, this means optimizing production processes; for government agencies, it means more efficient monitoring and project management.
What sets Palantir (PLTR) apart is its focus on long-term contracts with major government and military customers. The company recently expanded its contract with the U.S. Army to $619 million through 2028. Plus, Palantir is scaling further through cloud services and ready-to-deploy Foundry modules, making PLTR more accessible to mid-sized businesses.
Potential Challenges and Risks
Budget Cuts in the U.S. Palantir is prepared to work with the newly formed Department of Government Efficiency (DOGE) under Elon Musk. Yet, given President Donald Trump’s push for trimming government spending, there’s always the possibility of budget reductions. That’s exactly what was announced last week.
Competition. The U.S. Big Data and AI market is complex. A growing number of startups are entering the scene, and tech giants like IBM, Microsoft, and Oracle all offer their own analytics and cloud solutions.
Market Valuation Complexity. As CNBC notes, analysts find it incredibly hard to determine the upper limit for Palantir’s solutions since use cases span everything from the U.S. military to retail. That leads to target prices from Wall Street often lagging behind actual market dynamics.
Is Palantir a Good Stock to Buy?
Considering the latest news and the Q4 earnings report, the sentiment is mixed. On one hand, the earnings report was quite optimistic, but on the other, the recent developments raise concerns.
Right now, watching PLTR stock is especially intriguing—will the decline continue, or is a rebound on the horizon? Personally, I’d wait a bit, look for signs of stabilization and a slight recovery before buying in. At this moment, my take on PLTR is HOLD, with a Future BUY once the stock finds a new bottom.
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This article is for informational purposes only and does not constitute financial advice. The content reflects the author’s opinion and should not be interpreted as an investment recommendation.
