Ex-Palantir Bear Turns Neutral As Mizuho Calls Growth 'Stunning' Despite Valuation Worries
A former Palantir Technologies Inc. (NYSE:PLTR) bear has decided to alter his stance on the company’s stock.
What Happened: Mizuho Securities analyst Gregg Moskowitz and his team have upgraded their rating on Palantir’s stock from underperform to neutral on Wednesday, reported MarketWatch.
The analysts recognized the company's surge in business activity, especially within its commercial and government segments, which they admitted to previously underestimating.
Moskowitz and his team highlighted the company’s “recent execution and momentum” as “stunning,” which could potentially lead to a fifth consecutive quarter of revenue growth acceleration. Despite their concerns about the stock’s high valuation, the analysts recognize Palantir’s uniqueness and potential for future growth.
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Palantir’s stock is currently trading at an enterprise-value-to-sales multiple of 97 times and 77 times, based on 2025 and 2026 projections, respectively. Analysts also expect the company's government revenue to maintain strong year-over-year growth of over 40%.
Despite their upgrade, the Mizuho team remains cautious, stating that there are “many more compelling names to own in software at these levels.” Their target price for Palantir’s stock stands at $135, below the approximately $150 level at which the stock was trading early Wednesday, suggesting a downside of over 10%.
Why It Matters: The shift in the analysts’ stance comes amidst a period of significant developments for Palantir. The company’s stock has seen a surge of over 400% in the past year, driven by its expanding commercial business in the U.S. and its increasing adoption of artificial intelligence platforms.
One of the key drivers of this growth has been Palantir’s GenAI engine, which has been instrumental in helping companies like AT&T (NYSE:T) to fix code, cut costs, and rewrite their network.
This has led to a growing urgency around internal data integration, further fueling Palantir’s growth.
Price Action: Palantir (PLTR) shares slipped 0.13% in after-hours trading, after rising 1.57% during the regular session on Wednesday. So far this year, the stock has surged 100.70%, and over the past 12 months, it’s up an impressive 434.76%, according to Benzinga Pro data.
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Posted-In: Equities
