TLDR
- Palantir reported Q2 revenue of $1.94 billion, up 92.8% year over year, beating analyst estimates of $1.81 billion
- The Maven Smart System is approaching $1 billion in annual revenue and nearing Pentagon program-of-record status
- PLTR opened at $186.29 on Monday with a 52-week range of $106.37 to $207.52
- Institutional ownership sits at 45.65%, with major funds including State Street, Norges Bank, and Arrowstreet Capital boosting positions
- Valuation remains the key debate, with the stock trading at roughly 159 times earnings against a sector median in the low 20s
Palantir Technologies (PLTR) opened at $186.29 on Monday, not far off its 52-week high of $207.52. The stock has more than doubled off its 52-week low of $106.37, fueled by blowout earnings and growing confidence in its AI business.
Palantir Technologies Inc., PLTR
Q2 results were hard to ignore. Revenue hit $1.94 billion, up 92.8% year over year and well ahead of the $1.81 billion analysts had expected. Earnings per share came in at $0.41, topping the $0.34 consensus by seven cents. Adjusted free cash flow reached $1.22 billion at a 63% margin.
The company’s Rule of 40 score hit 155%, driven by a 62% adjusted operating margin. Net margin came in at 49%. These are numbers most software companies can only dream about.
On the defense side, Palantir’s Maven Smart System is closing in on $1 billion in annual revenue. The Pentagon is pushing toward naming it a program of record, which could unlock up to $2.3 billion in funding over five years. A separate Pentagon memo has directed $240 million in additional services to Palantir without competitive bidding.
Truist and other firms see Palantir’s network of forward-deployed engineers as a competitive moat that rivals like OpenAI and Anthropic will find difficult to replicate. Wall Street’s consensus sits at Moderate Buy, with an average price target of $192.19.
Institutions Keep Buying
Institutional interest has been building steadily. RPg Family Wealth Advisory grew its position by 78.6% in Q2, adding 25,162 units to reach 57,173, valued at roughly $6.67 million.
Bigger players moved too. Norges Bank initiated a new position worth over $5.1 billion. Arrowstreet Capital grew its stake by 277.4% in Q1. Cardano Risk Management increased its position by 917.4% in Q4. State Street now holds over 101 million units. Institutional ownership stands at 45.65%.
Valuation Is the Real Question
At roughly 159 times earnings, Palantir is trading at a steep premium. The sector median is in the low 20s. Jefferies has a sell rating and a price target of $80. Royal Bank of Canada is also at underperform with a $90 target. On the other side, UBS has a $215 target.
Some analysts flag that Palantir’s unusually low effective tax rate is boosting its margin profile, and that this may not hold as the business scales. Investor Steve Eisman has also raised concerns about AI revenue concentration among a small number of cloud players.
Insider Activity
CEO Alexander Karp sold 492,348 units on August 20th at an average price of $174.79, totaling roughly $86 million. The sale was executed under a pre-arranged Rule 10b5-1 plan to cover tax withholding on equity award vesting. Insider Jeffrey Buckley sold 1,250 units at $174.29 on August 21st. Insiders have sold approximately $116.8 million worth of stock over the past three months. Insiders own 9.53% of the company.
Analysts expect Palantir to post full-year earnings of $1.27 per share.
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