Summary
⚈ Major banks raised price targets but still expect a possible stock correction ahead.
⚈ Analysts remain cautious due to Palantir’s high valuation and rising short interest.
Five banking giants — DA Davidson, Morgan Stanley, Goldman Sachs, Raymond James, and Mizuho, have revisited their price targets on Palantir stock (NASDAQ: PLTR) following the artificial intelligence (AI) company’s Q1 2025 earnings report.
The Alex Karp-led data analytics venture posted earnings per share (EPS) of $0.13, in line with consensus estimates, and revenues of $844 million, above average forecasts, which were pegged at $863 million.
While commercial revenue grew by 71% on a year-over-year (YoY) basis, together with a 45% increase in government segment sales in the same timeframe and a hike in revenue guidance, Wall Street remains skeptical, with the company’s high valuation being a perennial pain point.
At press time on May 6, PLTR stock was changing hands at $115.21 in the pre-market trading session, having marked a 6.9% decline from the previous day’s close of $123.77. Palantir shares are still up 3.16% on the weekly chart, and 51.55% on a year-to-date (YTD) basis.
Most of the analyst revisions, even the bullish ones, imply a significant downside. While the aforementioned banking giants did note several positive developments, as PLTR stock’s moves to the upside are sharp and sudden, with no defined consolidation periods, a sharp move to the downside remains a distinct possibility in the near term, particularly in view of elevated short interest.
Analysts anticipate Palantir stock price correction
The highest revised price target was set by DA Davidson researcher Gil Luria, who reiterated a ‘Neutral’ rating and hiked his 12-month forecast from $100 to $115. If met, Luria’s target would equate to a 0.18% decrease in price. The analyst cited “unrelenting demand in a seasonally light quarter” and immunity to tariff risks as the key drivers behind his decision.
Next up is Sanjit Singh of Morgan Stanley, who maintained an ‘Equalweight’ rating and raised his price target from $90 to $98. Singh highlighted the company’s impressive revenue and sales growth across the board, while noting the international commercial as the only weak spot. The analyst’s price target implies a 14.93% downside compared to the current price of Palantir stock.
Mizuho equity analyst Gregg Moskowitz doubled down on an ‘Underperform’ rating, but raised his price target from $80 to $94. While the researcher did note how impressed Mizuho is with Palantir’s execution, when it comes to PLTR stock prices, the bank maintains that valuation “cannot and should not be irrelevant” and that it finds it difficult to justify a 60x CY2026 revenue multiple. Moskowitz’s forecast implies an 18.4% downside.
Lastly, we have Goldman Sachs’s Gabriela Borges and Raymond James’s Brian Gesuale. The former doubled down on a ‘Neutral’ rating and increased her price target on Palantir stock from $80 to $90, highlighting enterprise AI adoption but cautioning against the high valuation of PLTR stock, while the latter maintained a ‘Market Perform’ rating without a set price target.
Featured image via Shutterstock
