Bank of America says Palantir could soar soon

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•  04 Nov 2025
 

•   PLTR  
   
  -7.93%

It’s been a rough stretch for $PLTR lately. The stock slid nearly 7% after earnings, even as the company delivered one of its most impressive reports to date with revenue up 63% year-over-year, commercial growth surging 73%, and U.S. government contracts up 52%. But while many analysts have turned cautious, Bank of America just doubled down on its bullish view, calling Palantir the true “architect of AI” and setting a bold new price target that implies a 30% upside from here.

BofA analysts Mariana Perez Mora and Ronald Epstein raised their target from $215 to $255 and backed their optimism with strong data: Palantir’s “Rule of 40” score hit a record 114%, underscoring exceptional operating efficiency. Despite headcount growing only 10%, revenue soared more than sixfold that pace a rare feat even among AI leaders. The firm’s free cash flow topped $450 million in Q3, and its total contracted value hit $3.8 billion, nearly triple its annual sales.

So why the disconnect between fundamentals and stock price? For one, investors are wrestling with valuation. Even with accelerating profits and a dominant AI platform (AIP), Palantir trades like a company expected to sustain 30%+ growth for years. That’s a tall order but BofA argues it’s justified.

Their latest report draws a vivid “Matrix” analogy: Palantir offers the red pill a deep, results-driven AI ecosystem built around real-world deployment, data integration, and specialized engineering teams (FDEs). Competitors, they say, offer the blue pill generic AI wrappers with limited ROI. In a world where 95% of enterprises report no measurable return from AI, Palantir’s approach looks different and that difference may soon define who leads the next phase of the AI economy.

Looking ahead, BofA expects Palantir to post earnings of $0.72 in 2025, $0.99 in 2026, and $1.35 in 2027, with an average annual growth rate of 36% through 2030. They see the company’s role in defense, government, and corporate data systems expanding rapidly, positioning it as the “digital command system” of modern intelligence and automation.

Still, the valuation debate won’t fade easily. Even its strongest supporters admit $PLTR is priced for near-perfection and any slowdown could test investor faith. But for long-term believers in enterprise AI and data-driven defense, Palantir remains one of the few names that actually *delivers* what others promise.

As volatility shakes out the skeptics, the question isn’t whether Palantir’s vision is real it’s whether the market’s patience will hold long enough to see it fully priced in.

Full analysis on $PLTR and the Bank of America report available here

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