Palantir Hits Two Week Losing Streak. Will Wall Street Analysts Have Last Laugh?

Palantir Technologies, the data analytics software giant, has been on a rollercoaster ride over the past two weeks, experiencing a significant losing streak. The company's stock price has taken a tumble, raising questions about the reasons behind this downturn and whether Wall Street analysts will ultimately be proven right in their cautious stance. Let's delve into the factors contributing to Palantir's recent performance and explore the insights provided by analysts.

Analyst Ratings and Price Targets

The average analyst rating for Palantir stock from 20 stock analysts is "Hold," indicating that analysts believe this stock is likely to perform similarly to the overall market. This consensus suggests that analysts are cautious about Palantir's near-term prospects. The 12-month stock price forecast is $78.28, which is a decrease of -7.82% from the current stock price of $84.92. This average target predicts a modest decline in Palantir's stock price, aligning with the company's recent performance.



Revenue and EPS Growth

Palantir's recent financial performance has been impressive, with revenue increasing by 34.43% year-over-year to $3.85 billion in 2024. Earnings per share (EPS) grew by 195.32% to $0.56 during the same period. However, the market may be anticipating even higher growth rates, leading to a sell-off in the stock. For instance, revenue growth for the next year is projected to be 27.47%, which is lower than the previous year's growth rate of 34.43%. Similarly, EPS growth for the next year is expected to be 27.04%, down from the previous year's growth rate of 195.32%.



Geopolitical Risks and Government Contracts

As a company with significant government contracts, Palantir may be vulnerable to geopolitical risks and changes in government spending priorities. Reports that the Trump administration is considering trimming the US defense budget have led to investor concerns, potentially contributing to Palantir's stock price decline. However, the company's strong financial performance and growth prospects may outweigh these geopolitical risks in the long run.

Analyst Expectations and Catalysts

Analysts' expectations for Palantir's stock price are mixed, with some maintaining a "Hold" rating and others having strong buy ratings and price targets as high as $141. The wide range of price targets indicates a significant disagreement among analysts regarding Palantir's future stock price. Key catalysts for Palantir's stock price include revenue growth, financial performance, analyst ratings, and government contracts. However, geopolitical risks, competition, and product innovation also play a role in shaping analyst expectations and Palantir's stock price trajectory.

In conclusion, Palantir's recent two-week losing streak can be attributed to several factors, including analyst ratings, price targets, revenue and EPS growth, and geopolitical risks. While the company's strong financial performance and growth prospects are encouraging, the market may be anticipating even higher growth rates. Analysts' expectations for Palantir's stock price are mixed, with some maintaining a "Hold" rating and others having strong buy ratings and price targets. As investors weigh the company's prospects, they should consider the factors contributing to Palantir's recent performance and the insights provided by analysts. Ultimately, the market will determine whether Wall Street analysts have the last laugh on Palantir's stock price.