1 Reason Wall Street Is Obsessed With Palantir Stock

Key Points

• Palantir is a leading AI software provider.

• The company reported strong Q2 2025 financial results, which featured strong growth from business with the U.S. government.

• Investors must always remember to perform their own due diligence and not solely rely on analysts' opinions.

• 10 stocks we like better than Palantir Technologies ›

Investors have been laser-focused on artificial intelligence (AI) stocks for months now. From semiconductor companies like Nvidia and Broadcom to AI hyperscalers like CoreWeave and Nebius, investors have paid steadfast attention to companies that occupy a variety of niches in the AI industry.

One AI stock, in particular, that keeps popping on Wall Street's radar is Palantir (NASDAQ: PLTR). Let's take a look why analysts are so attentive to the AI stock right now and why investors should care.

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Analysts are thoroughly impressed with Palantir's progress

Since the company's initial public offering in 2020, Palantir stock has drawn strong attention, but it's over the past year that interest has ramped considerably higher -- especially over the past few weeks. Palantir reported second-quarter 2025 financial results -- results so encouraging that analysts see ample upside to Palantir stock.

Specifically, several analysts singled out the company's strong growth with respect to its business with the U.S. government, which totaled revenue of $426 million, representing 53% year-over-year growth.

Citigroup, for example, hiked its price target to $177 from $158 after the company reported quarterly earnings, which featured "show-stopping" Q2 2025 results stemming from U.S. commercial and government momentum, according to The Fly. Similarly, Piper Sandler bumped its price target on Palantir stock to $182 from $170 due to strong demand from both the U.S. government and commercial customers.

Other firms also waxed bullish on Palantir stock in August. Wedbush lifted its price target on Palantir stock to $200 from $160 due to the strong demand for the company's Artificial Intelligence Platform, although the firm didn't specifically single out the government business.

Is there nary one bear on Wall Street?

While many analysts are enthusiastic about Palantir, it's important to recognize that support for the AI stock is not unanimous. Andrew Left from Citron Research, for instance, believes Palantir stock is wildly overvalued. The takeaway for investors, ultimately, is that it's best to not look solely to analysts for validations that stocks are good buys or not. Investors must perform their own due diligence.

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

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Citigroup is an advertising partner of Motley Fool Money. Scott Levine has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Nvidia and Palantir Technologies. The Motley Fool recommends Broadcom and Nebius Group. The Motley Fool has a disclosure policy.