The Biggest Bet in Tech Isn't on Polymarket. It's This AI Stock.

Prediction markets like Polymarket and Kalshi have been on the rise since 2024, when Polymarket became a far more accurate predictor of which candidate would win that year's presidential election than any pollster.

But when it comes to how to generate a solid return for yourself, you'd be far better off investing in the stock market than betting on an election or a football game.

And while prediction markets have yet to prove they'll be a durable trend, artificial intelligence (AI) has certainly proved it has staying power.

And one of the most interesting AI companies is Palantir (NASDAQ: PLTR), which is a unique hybrid of an AI tech company and a defense contractor.

Image source: Getty Images.

Revolutionizing information warfare

Palantir is proof positive that one of the most effective weapons a military can have is information.

Its Gotham platform connects everything on a battlefield that a commander might want to see from a bodycam worn by an individual soldier to a satellite orbiting overhead. It helps to remove some of the fog of war and allow for clearer decision-making.

Gotham is a large part of why the U.S. government is Palantir's single largest customer, making up $1.85 billion of the $4.48 billion in revenue the company generated in 2025.

Last year also saw Palantir's U.S. government revenue grow 55% over 2024 and its total revenue grow 56% over the same period.

But Palantir is also a commercial AI company, and its AIP platform allows companies to use Palantir's powerful programs to optimize their businesses in the same way it has allowed generals to optimize their operations.

Revolutionizing information, period

AIP users can see all their operations across their business in one place and set up AI applications to automate as much as possible. The government also makes use of AIP, but so do Lowe's and Lockheed Martin, among others.

It's no wonder why Palantir is growing as quickly as it is if you look at the results its software can generate.

By using AIP, General Dynamics reduced the time it took to plan its submarine schedule from 160 hours to 10 minutes. The Portsmouth Naval Shipyard reduced its material review time frame from weeks to under one hour.

Information, as it turns out, is just as effective a tool as it is a weapon.

And the power to use that tool is a profitable product to sell. Aside from its incredible revenue growth, Palantir also operates a net profit margin of 36.5% and has a debt-to-equity ratio of 0.03%.

For 2026, it's anticipating even more incredible growth. For the full year, Palantir has set guidance of $7.182 to $7.198 billion, which would represent 60% growth over 2025's number.

Now, it must be noted that Palantir is trading at a price to earnings (P/E) ratio of 248 right now which is very high. However, when you factor in growth, expressed in its projected future earnings, you get Palantir's price to earnings to growth (PEG) ratio which is 3.49 at present.

That's above the ideal, which is 1. That said, this valuation is still lower than the 5+ PEG ratio the company has maintained since 2024. The valuation is a concern, but one that's mitigated by Palantir's growth rate and overall strong fundamentals. However, if its growth stalls Palantir begins to look even more overvalued.

Give Palantir a look if you want a better way to generate a return than betting on who will win your next election.

James Hires has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Palantir Technologies. The Motley Fool has a disclosure policy.