The Ultimate Growth Stock to Buy With $1,000 Right Now

Key Points

• Palantir Technologies saw 48% revenue growth in the second quarter.

• Government agencies and commercial businesses appear eager to use Palantir's AIP platform.

• The valuation is always the sticking point when considering Palantir.

• 10 stocks we like better than Palantir Technologies ›

In general, you can divide the market into two camps -- value stocks and growth stocks.

Value stocks represent companies that are trading at an attractive valuation, such as price-to-earnings ratio or price-to-sales ratio. These companies are typically stable, mature and often provide a dividend. In fact, if you want to see some strong value stocks, check out Warren Buffett's moves.

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Growth stocks, on the other hand, are big movers that are seeing outsized revenue or market share growth. These dynamic names in the market are often at the cutting edge of innovations -- so many of them are technology stocks -- and they also come with some volatility because the companies are scrambling to seize the moment. Their valuations tend to be poor, but investors are still buying because of their massive potential. Another trait of growth stocks is that their earnings may not be as strong as value stocks because they are pumping their profits back into the company -- either to fund research or to scale the business.

There are hundreds of growth stocks from which to choose, but if you're looking for the ultimate growth stock in the market, there's only one to consider, and that's Palantir Technologies (NASDAQ: PLTR).

Palantir's massive growth

Palantir started its incredible growth story two decades ago when it decided to take a new approach to automated approaches to technology -- customized systems that took too long to deploy, were too slow, and were unable to adapt. Palantir's approach was to create platforms that took into data from literally hundreds of sources at the same time, analyzed them and came up with actionable intelligence. It became a data mining company that developed software that turned incomprehensible material into something usable. The company's DNA is in the military and intelligence arena as it developed products that helped commanders position troops and find adversaries, including 9/11 mastermind Osama bin Laden in 2011.

But the company really took off when it developed its Artificial Intelligence Platform (AIP) in 2023 and began rolling it out through AIP bootcamps that demonstrated to customers how quickly they could access Palantir's massive database. AIP uses generative artificial intelligence and allows customers to start getting actionable insights from Palantir's massive databases in literally a matter of hours. Suddenly, a data mining company that was primarily known as a military or intelligence contractor was accessible to commercial businesses as well as other branches of government. CEO Alexander Karp wrote about the growth in a letter to shareholders on Aug. 4, 2025.

The growth rate of our business has accelerated radically, after years of investment on our part and derision by some. ... It has been a steep and upward climb -- an ascent that is a reflection of the remarkable confluence of the arrival of language models, the chips necessary to power them, and our software infrastructure, one that allows organizations to tether the power of artificial intelligence to objects and relationships in the real world.

Palantir by the numbers

When you think about ultimate growth stocks, Palantir's second quarter comes to mind. Revenue grew 48% from a year ago as the company topped $1 billion in quarterly sales for the first time. Its U.S. government revenue was up 53% to $426 million, and its U.S. commercial revenue was up 93% to $306 million.

Incredibly, Palantir closed 157 deals with values of at least $1 million in the second quarter, with 66 deals valued at $5 million-plus and 42 deals valued at $10 million-plus. The company's customer count is growing rapidly, rising from 593 in the second quarter of 2024 to 849 by the second quarter of 2025.

In addition, the company's operating income continues to grow at an accelerated rate.

Source: Palantir Q2 2025 Investor Presentation

If there's anything to give investors pause, it's the company's valuation. Trading at a forward price-to-earnings ratio of 243 and a forward price-to-sales ratio of nearly 90, future earnings are already baked into Palantir stock and some analysts, such as JPMorgan's Dubravko Lakos-Bujas, say the stock is "overcrowded" and runs the risk of sinking in the second half. And objectively, the ratios are screaming red flags when you look at some other blue-chip growth stocks.

PLTR PE Ratio (Forward) data by YCharts

I agree the valuation is hard to stomach. But also, it's to be expected for a stock that was the best-performing S&P 500 stock in 2024 and is vying to repeat that number this year. Palantir is revolutionizing how businesses and companies operate and there's no other company that can do what it offers.

If you're investing in Palantir, you have to be willing to accept some risk and volatility. But as it continues to gain more customers, increases its revenue, and becomes a key partner for hundreds of businesses, Palantir is unquestionably the ultimate growth stock for 2025.

Should you invest $1,000 in Palantir Technologies right now?

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Patrick Sanders has positions in Nvidia and Palantir Technologies. The Motley Fool has positions in and recommends Apple, Microsoft, Nvidia, and Palantir Technologies. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.