Palantir Stock Could Be 'The Next Oracle,' Says Analyst, But Should You Buy PLTR Now?

Palantir Technologies (PLTR) stock is trading slightly higher this morning, after the company landed yet another love letter from analyst Dan Ives at Wedbush Securities. The well-known tech bull, who has previously described Palantir as “the Messi of AI” in a reference to the soccer superstar, backed his view today that PLTR is on pace to become the market’s next software monolith. 

“We are raising our price target on Palantir from $75 to $90 as our recent checks and growing confidence in the company's AI strategy is key to the bull thesis on Palantir for 2025,” wrote Ives today on his X account. “We believe Palantir has a path to become the next Oracle or Salesforce over the coming years,” added the analyst, including a few of his trademark emojis for good measure.

Despite the positive sentiment from Wedbush, there are mixed views among analysts regarding the sustainability of Palantir's stock price. Some express concerns about potential overvaluation, a common issue in emerging tech sectors. 

The new $90 price target from Ives is now the Street-high, while the average price target from analysts is $46.41 - implying expected downside of about 40%. This caution is seemingly echoed by hedge funds like Citadel and D.E. Shaw, which recently reduced their holdings in Palantir, signaling a more conservative approach. 

That said, PLTR stock has delivered remarkable growth, with a 171.5% increase over the past six months alone. This surge is largely attributed to the company's strategic focus on artificial intelligence (AI), which has yielded increased adoption for its Artificial Intelligence Platform (AIP) among clients. 

While the company's AI capabilities and strategic positioning are promising, its high valuation remains a concern, suggesting that investors should remain vigilant and consider the possibility of price corrections.

Looking ahead, PLTR is slated to report quarterly earnings after the close on Monday, Feb. 3. Ahead of the event, options traders are pricing in a move of more than 12% for the stock, compared to its February 2024 post-earnings surge of more than 30%. On average, Palantir stock has moved 19.9% after earnings over the past four quarters.