What's next for Palantir stock in 2026?
Major investors are selling.
Palantir Technologies (PLTR) has been one of the hottest AI names in 2025, with the stock soaring 150% year-to-date due to explosive demand for its AI software and record revenue growth.
The shares are up nearly 3,000% in the past three years, but with valuations stretched and AI enthusiasm under debate, investors are questioning how much higher Palantir can go.
Palantir develops data analytics and AI software platforms, including Gotham, Foundry, Apollo, and Palantir Artificial Intelligence Platform, that help organizations integrate, analyze, and act on complex data.
On November 3, Palantir stock hit an all-time high, closing at $207.52 after the company reported a strong third quarter.
Palantir reported $1.18 billion in revenue, up 63% from a year earlier, with U.S. commercial sales jumping 121% to $397 million. Adjusted earnings came in at 21 cents a share, beating analysts’ estimate of 17cents. gettyimages
Investors weigh growth against valuation
Palantir’s momentum has been fueled in part by demand from the U.S. government, especially military agencies. In July 2025, the company was awarded a deal worth up to $10 billion with the U.S. Army. But Palantir doesn't rely only on the U.S. government. Its commercial clients include Airbus, Morgan Stanley, and Merck KGaA.
The company has repeatedly raised its financial outlook for 2025, most recently after its third-quarter earnings report, driven by high demand for its AI products.
But concerns are growing as well. Palantir’s biggest red flag is its valuation, with the stock trading at a trailing price-to-earnings ratio of 435.09, far above the software sector average, according to Yahoo Finance data.
Wall Street remains divided. Of the 16 analysts tracked, 11 give Palantir stock a hold rating, with limited upside implied by an average price target of about $187, according to data from TipRanks.
Major investors are trimming their Palantir stakes
Stanley Druckenmiller, one of the world’s most respected investors who runs Duquesne Family Office, reduced and ultimately exited his 769,965 share position in Palantir between mid-2024 and March 2025.
Cathie Wood, CEO of Ark Invest, has steadily trimmed Palantir over the past five quarters, selling roughly a combined 9 million shares from Q3 2024 through Q3 2025, according to data from Stockcircle.
Related: Cathie Wood buys $26.1 million of battered tech stock
But Palantir is still one of Wood’s largest positions, accounting for about 3.9% of the flagship Ark Innovation ETF (ARKK) and ranking eighth in the portfolio.
“Palantir is a very expensive stock, but there’s nothing like it in the software space,” Wood said in a CNBC interview in February 2025. “It is, we believe, going to dominate the biggest part of the tech stack when it comes to AI. And that’s the platform as a service part of the stack.”
Palantir could reach a $1 trillion valuation, analyst says
After attending a recent Palantir customer event, Wedbush analyst Dan Ives said his confidence in the company strengthened.
“We come away incrementally more bullish given the various use cases Palantir’s entire portfolio can provide to all industries,” Ives said in a Dec. 5 research note sent to TheStreet.
“Palantir continues to see unprecedented demand for AIP, especially across US commercial by taking AI solutions that solve meaningful problems across organizations at enterprise scale with shorter sales cycles and faster deployment timelines versus its competitors,” Ives noted.
After having conversations with prospective customers, Ives said many were surprised by Palantir's demonstrations, hinting that the market still underestimates the scope of Palantir’s technology.
On the infrastructure side, Palantir recently launched Chain Reaction with partners CenterPoint Energy and Nvidia, a move designed to address power and infrastructure constraints that have become bottlenecks for large-scale AI deployment.
"We have spent years quietly deploying systems that keep power plants running and grids reliable," said Tristan Gruska, Palantir’s Head of Energy and Infrastructure.
Nvidia is also expanding its partnership with Palantir. The chipmaker is using Palantir’s AIP and Ontology alongside Nvidia’s CUDA X libraries and accelerated computing to help manage supply chains and support AI infrastructure deployments.
Ives has long been bullish on Palantir stock. He has a price target of $230 and an outperform rating for the stock.
In 2026, Ives said Palantir will "expand its commercial AI success with AIP and be one of the leaders of the software being front and center in the AI Revolution.
He added that Palantir is on track to reach a $1 trillion valuation over the next 2 to 3 years, according to a Dec. 18 note sent to TheStreet.
Palantir closed at $188.71 on Dec. 26, and its market cap currently stands at roughly $450 billion.
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