TLDR
- Phillip Securities initiates Palantir coverage with Buy rating and $208 price target, suggesting 25% upside from current levels
- Analyst projects 47% revenue growth to $4.2 billion in FY25, driven by commercial segment expanding 51%
- Net profit forecast to nearly double in FY25 as operational efficiency improves and contract values increase
- U.S. business expected to grow 66% year-over-year, fueled by intelligence spending and commercial AI adoption
- Commercial deal sizes in the U.S. roughly doubled during Q3 FY25, highlighting accelerating demand
Phillip Securities analyst Alif Fahmi initiated coverage on Palantir Technologies with a Buy rating. The firm set a $208 price target, implying 25% upside potential.
Palantir Technologies Inc., PLTR
The analyst expects the company to enter a phase of accelerated growth. Strong U.S. demand and increased AI platform adoption are the key drivers.
Fahmi projects revenue will rise 47% year-over-year to $4.2 billion in fiscal 2025. The commercial business is set to outpace government growth.
Commercial revenue should climb 51%, faster than the 43% growth expected in government revenue. This shift reflects broader enterprise adoption of AI solutions.
The company is expanding beyond its traditional defense focus. New industry applications are opening up additional revenue streams.
U.S. commercial deal sizes roughly doubled in Q3 FY25. This metric shows the growing value customers place on the AI platform.
Profitability on Track to Surge
Net profit is projected to nearly double in FY25. Improved operational scale is the primary factor behind this jump.
The company is also securing higher-value contracts. These agreements typically deliver better profit margins.
The U.S. market generates about 66% of total revenue. This region remains the most important growth driver.
Fahmi expects U.S. sales to increase 66% year-over-year in FY25. Multiple factors are contributing to this expansion.
Government spending is rising due to global tensions. U.S. intelligence budgets are growing.
The commercial segment is accelerating simultaneously. Strong AI platform adoption is powering this growth.
Price Target Based on DCF Model
The stock currently trades at 170 times forward price-to-earnings. This valuation sits below the negative one standard deviation level of 190.
Fahmi recognizes the premium valuation. However, he believes strong fundamentals support additional upside.
Phillip Securities used a discounted cash flow model for the $208 target. The calculation assumed an 8.3% weighted average cost of capital.
The firm also factored in a 4.2% risk-free rate and 8% terminal growth rate. These assumptions reflect expectations for sustained expansion.
On TipRanks, the stock has a Hold consensus rating. Six analysts recommend Buy, while 10 suggest Hold and two rate it Sell.
The average analyst price target is $193.76. This implies 17.20% upside from current trading levels.
The company recently extended its contract with France’s DGSI intelligence agency. This three-year renewal continues a partnership that started nearly a decade ago.
Palantir also broadened its partnership with HD Hyundai in Korea. This expanded alliance will increase adoption of Foundry and the AI Platform across multiple HD Hyundai business units.
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