Palantir (PLTR.US) Q2 performance shines, Wall Street analysts raise target prices.

After Palantir (PLTR.US) reported second-quarter results and guidance that exceeded expectations, the stock price rose, and Wall Street analysts also held an optimistic view of the stock. Morgan Stanley maintained a "hold" rating on Palantir but raised the target price from $98 to $155. Led by analyst Sanjit Singh, the second quarter marked the eighth consecutive quarter of accelerated revenue growth and significant profit margin improvement. This strong performance was attributed to a further increase in the US commercial business growth rate from 71% in the first quarter to 93%, and a government business growth rate increase from 45% to 49%. Analysts added that third-quarter revenue guidance is expected to increase by 50% year-over-year, and the 2025 revenue growth guidance has been raised from 36% to 45%, with an operating profit margin of 46%, leading the industry, further proving its position as a clear winner in the field of artificial intelligence. Singh and the team noted that the only weakness was in the international commercial business, which declined by 3%, compared to a 5% decline in the first quarter. Piper Sandler gave Palantir an "overweight" rating and raised the target price from $170 to $182. Led by analyst Brent Bracelin, the team noted that Palantir won a 10-year, $10 billion contract with the US Army, further demonstrating the feasibility of expanding its government business share in the defense market of over $1 trillion. Additionally, the company's US commercial business growth rate increased to 93%, highlighting the potential to develop AI platforms for large enterprise clients. Analysts stated, "Despite Palantir's high valuation premium and classification as a high-risk investment, its unique 'growth + profit margin' model puts it in a unique position worthy of a premium." Cantor reiterated a "neutral" rating on Palantir but raised the target price from $110 to $155. Analyst Thomas Blakey and the team stated that Palantir's management guidance for the US commercial business indicates that the business performance will continue to grow by nearly 90% despite maintaining a strong growth trajectory in the second half of 2024. Total Contract Value (TCV), bookings, and remaining deal value for Palantir set new records, with a focus on the US region. The Cantor model predicts that by the end of 2026, revenue from the US region will account for nearly 80%, compared to the previous forecast of 75%. Analysts said, "Palantir remains in a leading position in leveraging the long-term growth trend of artificial intelligence, which seems to be driving industry transformation and the company's own development. Our 'neutral' rating is based on its valuation continuing to reflect this industry-leading position." Before the opening of the US stock market on Wednesday, Palantir was up 0.52% at $174.17 as of the time of writing. The stock rose 7.85% on Tuesday, with a year-to-date increase of 129%.