Palantir Bulls vs Bears Before the Big Report

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•  02 Feb 2026
 

•   NVDA  
   
  -0.96%
•   PLTR  
   
  -0.22%
•   SNOW  
   
  -0.39%

All eyes are on $PLTR tonight as Palantir prepares to report fourth-quarter earnings after the closing bell, and the tension in the market is hard to ignore. Few stocks have created such a sharp divide between retail investors and institutional analysts. Retail traders embraced the story early and were rewarded. Many institutions warned about valuation risk. So far, the independent investors have had the upper hand. Now, with the stock down roughly 25% over the past three months, the big question returns: is this a healthy correction, or the start of something deeper?

Despite the recent pullback, Palantir is still up around 83% over the past year. That kind of performance changes psychology. Traders who bought the breakout are sitting on gains but watching volatility rise. Late buyers are wondering if they stepped in too high. And analysts are split in a way that is unusual even for a high-growth AI name.

The consensus heading into earnings calls for earnings per share of about $0.22 to $0.24 on revenue of $1.32 to $1.34 billion. In the previous quarter, Palantir posted adjusted EPS of $0.21 on revenue of approximately $1.18 billion, beating expectations. Growth remains strong on paper. Government contracts, especially U.S. defense-related deals, continue to anchor the story. Meanwhile, U.S. commercial revenue has more than doubled year over year, supported by partnerships across the AI ecosystem, including players like $NVDA and $SNOW.

Yet even with solid growth metrics, caution dominates Wall Street ratings. Out of nearly 30 analysts covering the stock, only a small minority rate it a strong buy. The majority sit at hold. The average price target implies roughly 25% upside, but that figure masks a massive dispersion between the most bullish and most bearish forecasts.

The optimistic camp sees the recent drop as largely technical, driven by broader weakness in software stocks within the S&P 500. Bulls argue that Palantir is evolving into a core platform for enterprise and government adoption of generative AI. Analysts at firms like William Blair, Citi, and Truist have recently reiterated or upgraded their views, with price targets ranging from $200 to $235. Their thesis is straightforward: accelerating AI budgets, rising global defense spending, and a financial profile that includes free cash flow margins above 40% justify a premium multiple. In their view, 2026 could bring additional upward revisions if execution continues.

The bearish camp is far less forgiving. RBC Capital Markets maintains an Underperform rating with a $50 price target, a dramatic outlier compared to the rest of the Street. The core argument is valuation discipline. Bears question whether Palantir deserves to be the most expensive name in their software coverage universe. Concerns center on potential churn in commercial accounts and the risk that government growth may not meet elevated expectations. Without a clear “beat and raise” quarter that materially lifts forward guidance, skeptics argue the current valuation simply does not hold up under traditional software metrics.

For traders, tonight report is less about what Palantir did last quarter and more about what management says next. Is commercial momentum accelerating fast enough to offset any softness? Are government contracts expanding in size and duration? And most importantly, will guidance reset expectations higher again?

In high-multiple stocks like $PLTR, perception can move the price more than the numbers themselves. A modest beat without raised guidance may not be enough. A strong beat combined with confident forward commentary could reignite momentum quickly. The gap between a $50 bear case and a $235 bull case tells you everything about the stakes.

This is no longer just a growth story. It is a credibility test for valuation, AI monetization, and long-term competitive positioning. By tomorrow morning, the market will have decided which side of the $PLTR debate is winning at least for now.

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