Piper Sandler Initiates Palantir At Overweight, Calling It A "Secular Winner In The AI Revolution"

TigerJul 25, 2025 1:44 PM

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Piper Sandler is the latest firm to highlight Palantir as a strong winning candidate in the artificial intelligence boom.

Palantir shares rose 3% in morning trading.

The bank initiated coverage of the software stock at an overweight rating and price target of $175, which offers upside of approximately 13% from Palantir’s Thursday closing price. Shares have surged nearly 105% this year.

Piper Sandler analyst Brent Bracelin called Palantir a solid buy, despite its massive year-to-date runup.

“No doubt, PLTR carries a rich valuation premium and remains a high-risk investment, but it also has a one-of-a-kind growth+margin model that if proven durable could grow into a $24B run-rate by [2032] via share gains across two $1+ trillion,” total addressable markets, he wrote. “The 22-year path to a ~$4 billion revenue run-rate with 40%+ [free cash flow] margins has been a long road traveled.”

An important catalyst for Palantir may come from the ongoing artificial intelligence trade, the analyst said, adding that the company could be a longer-term beneficiary.

“We see PLTR as a secular winner in the AI revolution with multiple drivers that could sustain 30%+ growth and 40%+ FCF margins,” he wrote. “While the culture, leadership, and journey may be unconventional, the impact in the AI revolution could be lasting.”

Piper Sandler pointed out that Palantir may be taking the crown as an AI winner especially when compared to its peers. During the second quarter, visitor traffic accelerated to 144% year-over-year, versus 62% prior, comparable to other secular leaders within the AI space such as CoreWeave, ChatGPT, Anthropic, Anduril, Shield AI and Axon.

Palantir’s stock also could also rise as the company sustains compound annual growth rates of at least 30% in two segments: government and U.S. commercial.

“Sustaining 30%+ CAGR in government and U.S. Commercial appears doable given track record and two large $1+ trillion TAMs,” Bracelin added.

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