Palantir (PLTR) Stock in Late 2025: Navy Megadeal, AI Boom and a Post‑Rally Reality Check

Updated December 11, 2025

Palantir Technologies Inc. (NYSE: PLTR) has turned into one of 2025’s most controversial and closely watched artificial intelligence stocks. After a spectacular run that briefly pushed its market value into the $400–$500 billion range, the shares have been hit by a sharp November correction and then energized again by a massive new U.S. Navy AI contract. ^[1]

As of the latest trading session, Palantir stock trades around $188 per share, leaving it still up dramatically year to date even after a 20–25% pullback from its early‑November peak above $207. ^[2]

Investors now face a nuanced question: after the November 21 sell‑off, the fresh Navy “Ship OS” deal, and record Q3 2025 earnings, is PLTR stock still a buy — or is the AI trade finally overheating?

Palantir Stock Price in 2025: From Parabolic Rally to Sharp Pullback

Throughout 2025, Palantir has ridden the center of the enterprise AI boom. A Barchart analysis in mid‑November noted that the stock had soared roughly 204% over the prior 12 months and around 140% year‑to‑date, hitting a new high around $207.52 on November 3 following Q3 earnings. ^[3]

By late November, however, sentiment flipped. Key pressure points included:

• Growing talk of an “AI bubble,”
• Profit‑taking after an ~28x move from the stock’s 2025 low, and
• High‑profile bearish options positions disclosed by Michael Burry’s Scion Asset Management. ^[4]

On November 21, 2025, several pieces of analysis marked an inflection point:

• Trefis reported that PLTR fell 5.8% in a single day, trading around $155.75 and valuing the company at roughly $370 billion. ^[5]
• The same piece flagged eye‑watering valuation multiples: about 338x earnings and 435x EBIT, with trailing 12‑month revenue growth of 47% and operating margin of 22% — “very strong” fundamentals at a “very high” valuation. ^[6]
• TradingKey calculated that as of November 20 the stock had dropped about 24% from its $207.52 high to $155.75, clearly outpacing the broader Nasdaq’s decline and reflecting a violent re‑rating of AI leaders. ^[7]

Technical damage also showed up in broader coverage. Yahoo Finance highlighted that Palantir shares broke below their 100‑day moving average around November 21, a level that had previously served as support through the 2025 rally. ^[8]

In other words, November 21 marked the moment Palantir’s “unstoppable” chart finally cracked, forcing the market to reconsider how much AI optimism was already priced in.

Q3 2025 Earnings: Record Growth and a Rule‑of‑40 Score of 114%

Under the surface of that volatility, Palantir’s operating performance is arguably the strongest in its history.

According to the company’s Q3 2025 earnings materials and investor presentation, Palantir posted: ^[9]

• Total revenue: $1.18 billion, +63% year over year and +18% quarter over quarter
• U.S. revenue: $883 million, +77% year over year and +20% quarter over quarter
• U.S. commercial revenue: $397 million, +121% year over year and +29% quarter over quarter
• U.S. government revenue: $486 million, +52% year over year and +14% quarter over quarter
• Total contract value (TCV): Record $2.8 billion, up 151%
• U.S. commercial remaining deal value (RDV): $3.6 billion, up 199% year over year
• Adjusted operating income: $601 million, 51% margin
• Adjusted free cash flow: $540 million, 46% margin, with trailing‑12‑month FCF of $2.0 billion
• Adjusted EPS: $0.21; GAAP EPS: $0.18
• Rule‑of‑40 score:114%, a level rarely seen among large‑cap software names, combining explosive growth with high profitability. ^[10]

Palantir also raised its full‑year 2025 guidance, pointing to mid‑50% revenue growth and higher adjusted operating income and free cash flow than previously forecast, after already boosting its outlook following a blowout Q2. ^[11]

This is the fundamental tension in Palantir stock today:

The business is executing at near‑textbook levels for a mature software company, but the stock has been trading at valuations that assume years of flawless compounding.

Inside the November 21 Sell‑Off: Valuation Hangover and AI Bubble Fears

Multiple independent analyses published on November 21, 2025 tried to answer the same question: How worried should investors be about Palantir’s sudden drop?

1. Trefis: “Attractive but Volatile”

Trefis characterized Palantir as a “Very Strong” operator with “Very High” valuation, noting: ^[12]

• No net debt (debt‑to‑equity around 0);
• Cash‑to‑assets ratio near 0.8, signaling a very liquid balance sheet;
• Historically, after sharp dips, PLTR has delivered a median –7.4% return over the next year, i.e., dip‑buying has been risky but not uniformly disastrous.

Their stress‑test scenario contemplated further downside to around $109 (roughly 20–30% below late‑November levels), arguing that the stock had historically fallen as much or more during macro shocks — but had eventually recovered.

2. TradingKey: Short‑Term Panic, Long‑Term Buy‑the‑Dip

TradingKey’s November 21 deep dive framed the pullback as driven by three main forces: ^[13]

1. “Sell‑the‑news” after Q3: The stock had already run 28‑fold off its year’s lows before earnings; even excellent results could not justify unlimited multiple expansion.
2. High‑valuation unwind: Investors began questioning whether Palantir’s prior valuation was sustainable, leading to a rapid re‑rating as AI enthusiasm cooled.
3. Panic after Michael Burry’s puts: Burry’s disclosed put options on both Palantir and Nvidia intensified concerns about an AI bubble and triggered quant‑driven selling once key technical levels broke.

Despite those headwinds, TradingKey’s conclusion was explicitly bullish: Palantir’s fundamentals, Nvidia partnership, and cash flow strength support buying on dips for investors with a medium‑ to long‑term horizon. ^[14]

3. Barchart: Valuation at Nosebleed Levels

The Barchart November 12 column — widely circulated ahead of the drop — underlined just how stretched Palantir had become:

• Roughly 375x forward earnings,
• Price‑to‑sales above 160x,
• A stock price that had more than tripled in a year and doubled in 2025 alone. ^[15]

The author pointed out that at such levels, investors were essentially “betting on perfection”, leaving the stock vulnerable to even small disappointments in guidance, AI demand, or macro conditions.

New Defense and Government Deals: The $448 Million Navy “Ship OS” Contract and More

Just as November’s valuation hangover was settling in, Palantir landed a blockbuster contract that re‑energized the bull case.

The Navy’s Ship OS Program

In early December, the U.S. Navy announced a $448 million investment in a new Shipbuilding Operating System (“Ship OS”), built on Palantir’s Foundry and Artificial Intelligence Platform (AIP). ^[16]

Key details from Navy and media reports:

• Ship OS aims to modernize the submarine industrial base, targeting long‑standing delays and cost overruns in Virginia‑class and Columbia‑class programs. ^[17]
• Pilot projects at General Dynamics Electric Boat cut submarine schedule‑planning time from about 160 hours to under 10 minutes, while a Portsmouth Naval Shipyard pilot reduced material review times from weeks to under an hour. ^[18]
• The rollout will begin with submarine yards and then expand to two major shipbuilders, three public yards and roughly 100 suppliers, with the Navy signaling that lessons learned will be applied to surface ships as well. ^[19]

Investor‑focused outlets highlighted that this contract could become one of Palantir’s largest U.S. defense deals, potentially rivaling or exceeding marquee projects like the Army’s Maven AI program. ^[20]

Stocks reacted immediately: Palantir rose 2–3% on the news and has been one of the notable gainers in the market’s recent post‑Fed rebound. ^[21]

Immigration and Homeland Security Work: “Immigration OS”

Palantir’s government pipeline extended beyond the Pentagon in late 2025:

• USCIS/ICE platform: Fortune reported that federal contract language indicates Palantir is building a new “Immigration OS” system for U.S. Citizenship and Immigration Services and Immigration and Customs Enforcement, focused on detecting fraud such as sham marriages. ^[22]
• Health and Human Services: Separate federal award data show Palantir winning new contracts with the U.S. Department of Health and Human Services centered on enterprise data and analytics. ^[23]

Together with the Navy deal, these projects reinforce the message that Palantir remains deeply embedded in sensitive U.S. government missions, even as it pushes hard into commercial enterprise AI.

Commercial AI Momentum: Nvidia Partnership and Enterprise Growth

A major story behind Palantir’s Q3 2025 numbers is the explosion of U.S. commercial demand for its AI platform.

From the Q3 investor presentation: ^[24]

• U.S. commercial revenue grew 121% year over year to $397 million and now represents a rapidly expanding slice of the business.
• U.S. commercial remaining deal value surged 199% to $3.6 billion, showing that Palantir isn’t just signing one‑off pilots but locking in multi‑year contracts.
• The company closed 204 deals of at least $1 million, including 53 worth $10 million or more.

The presentation and third‑party analysis also highlight Palantir’s role as an “enterprise AI infrastructure” company: ^[25]

• Palantir’s flagship platforms — Gotham, Foundry, and AIP — are pitched as a full stack: from data ingestion and governance to model orchestration and decision automation.
• A high‑profile partnership with Nvidia makes Nvidia’s models available through AIP and positions Palantir as a key software outlet for Nvidia’s accelerated compute in industrial and defense settings. ^[26]
• Customer case studies, such as auto supplier Lear, show thousands of employees using Palantir for hundreds of use cases, with tens of millions of dollars in efficiency savings reported in 2025 alone. ^[27]

This commercial traction is central to the long‑term bull thesis: if AI becomes a basic operating layer for large enterprises, Palantir aims to be the default brain that sits on top of their data.

Analyst Targets and Palantir Stock Forecasts

Wall Street’s view on Palantir in late 2025 is remarkably split. Depending on which analyst you ask, PLTR is either modestly undervalued, fairly priced, or at serious risk of a large drawdown.

Consensus Targets and Ratings

A global analyst compilation from StocksGuide and other sources paints this approximate picture: ^[28]

• Around 30–35 analysts formally cover Palantir.
• Consensus rating: roughly Hold — with about 11 Buy, 18 Hold and 3 Sell recommendations in one tally. ^[29]
• Average 12‑month price target: about $192–$204 per share, implying single‑digit to low‑teens upside from current levels, depending on the dataset. ^[30]
• Street‑high target: around $255–$268, suggesting potential upside of roughly 35–45% in an optimistic scenario. ^[31]
• Street‑low target: roughly $50, implying downside greater than 70% if the AI thesis breaks. ^[32]

Barchart’s breakdown of 21 analysts (a slightly smaller subset) shows a consensus “Hold”, with only four “Strong Buy” ratings and several “Moderate” or “Strong Sell” calls still in place. ^[33]

Notable Bullish and Bearish Calls

Recent individual calls underscore the divide:

• Bullish camp
  • A recent Seeking Alpha note titled “Palantir: A Masterclass in Execution” upgraded the stock, pointing to the 114% Rule‑of‑40 score and improvement from 94% in Q2 as evidence that Palantir is simultaneously accelerating growth and margins — rare for a company of its size. ^[34]
  • Motley Fool coverage of “two AI stocks that will be bigger in 10 years” notes that many analysts raised their Palantir price targets in 2025 and that the median target sits around $200, a bit above today’s price. ^[35]
  • TradingKey, as noted, recommends accumulating PLTR on dips, arguing that the valuation reset actually improves the long‑term risk/reward. ^[36]
• Bearish/defensive camp
  • 24/7 Wall St. recently published a one‑year price target of $107, implying more than 40% downside from current levels. Their thesis: Palantir may have built premier AI software, but falling AI infrastructure costs and the rapid spread of large language models could erode its pricing power and moat. ^[37]
  • A Freedom Broker update lifted its target from $125 to $170 yet kept a Sell rating, essentially saying that even after the upgrade, they see material downside versus spot. ^[38]
  • Barchart highlighted RBC’s “Underperform” rating with a $50 target, citing concerns around heavy U.S. exposure, limited international traction, and uncertainty about the long‑term demand curve for AIP. ^[39]
  • Another widely read Seeking Alpha piece, “Palantir: The Music Is Slowing Down,” warned that Palantir’s market cap briefly exceeded $500 billion, and that even extremely strong fundamentals might not justify such a valuation if AI sentiment cools. ^[40]

In short, there is no clear consensus: some see PLTR as a durable AI compounder slightly undervalued after the pullback, while others view it as a high‑beta AI proxy still priced for perfection.

Fundamental Outlook: Earnings Power vs. Valuation Risk

Beyond headline targets, several structural themes will likely drive Palantir’s stock over the next 12–24 months.

What’s Working for Palantir

1. Explosive growth with real profits
   Q3’s combination of 63% revenue growth, 50%+ adjusted operating margins, and 46% FCF margin is extremely rare among large software companies. ^[41]
2. Diversifying beyond government
   U.S. commercial revenue is now the fastest‑growing segment, with 121% growth and a surging backlog. That helps reduce reliance on cyclical government spending while capturing AI‑driven demand from manufacturing, healthcare, and financial services. ^[42]
3. Deepening strategic moats
   The Navy’s Ship OS contract, new immigration and health‑data projects, plus the Nvidia ecosystem partnership all reinforce Palantir’s positioning in mission‑critical, heavily regulated environments where switching costs are high and trust is paramount. ^[43]
4. Balance sheet strength
   With effectively no net debt and a high cash‑to‑assets ratio, Palantir has ample flexibility to invest through any macro slowdown and continue R&D and go‑to‑market expansion. ^[44]

What Could Go Wrong

1. Valuation remains demanding
   Even after November’s correction, multiple frameworks (Trefis, Barchart and others) still show triple‑digit P/E multiples and valuation metrics far richer than the typical software peer set. ^[45]
2. Sensitivity to AI sentiment
   Palantir has become one of the poster children of AI euphoria. When AI “bubble” worries spike — as they did when Michael Burry’s puts became public — PLTR tends to sell off more than the market, both on the way up and down. ^[46]
3. Ethical, regulatory and reputational risk
   Projects like Immigration OS and work with enforcement agencies have attracted criticism for years. If political winds shift or regulatory scrutiny intensifies, some contracts could be delayed, scaled back or canceled. ^[47]
4. Insider selling and concentration
   Recent filings show significant insider activity — for example, director Alexander Cohen sold roughly $56.7 million worth of shares around November 21 at prices between about $153 and $158. While large insider sales are common in fast‑appreciating tech names, they can still weigh on sentiment. ^[48]

Is Palantir Stock a Buy After November 21, 2025?

Whether Palantir is attractive at ~$188 depends heavily on your time horizon and risk tolerance.

For Long‑Term, High‑Risk Tolerance Investors

The bullish case goes roughly like this:

• Palantir is emerging as a core operating layer for AI‑driven decision‑making in both the public and private sectors.
• Its Rule‑of‑40 score above 100, rapidly growing backlog, and deep integration with Nvidia’s ecosystem and U.S. defense programs suggest the business could keep compounding at above‑market rates. ^[49]
• The November correction plus subsequent consolidation may have taken the stock from “almost impossible to justify” toward merely “expensive but plausible,” especially if management meets or beats its upgraded guidance into 2026. ^[50]

If you believe the AI adoption curve is still early — and that Palantir will remain one of a handful of winners — buying partial positions on pullbacks and planning to hold through volatility is a defensible strategy that aligns with the more optimistic analyst targets ($200–$250+). ^[51]

For More Conservative or Valuation‑Sensitive Investors

On the other hand:

• Even the average Street target implies only modest upside from current levels, while bearish scenarios foresee 40–70% downside if multiples compress back toward high‑growth software norms. ^[52]
• Macro risks (slower global growth, AI spending digestion, higher‑than‑expected interest rates) could hit premium‑valued software names hardest.
• PLTR’s history of dramatic drawdowns — including an 84% drop from 2021 to 2022 before fully recovering by 2024 — is a reminder that this is not a low‑volatility stock. ^[53]

For investors focused on capital preservation, it may be more prudent to:

• Treat Palantir as a satellite position rather than a core holding,
• Wait for either a deeper correction or evidence that growth can sustain at elevated levels for multiple years, or
• Express a view via diversified AI or software ETFs instead of single‑name exposure.

Bottom Line: A High‑Quality, High‑Beta AI Pure Play

From November 21, 2025 onward, Palantir’s story has been one of tension between fundamentals and valuation:

• Fundamentals: Record growth, elite profitability, massive new government deals like the Navy’s Ship OS contract, and booming commercial demand anchored by Nvidia and blue‑chip enterprises. ^[54]
• Valuation & sentiment: A history of boom‑and‑bust cycles, still‑rich multiples, and polarized analyst opinions ranging from $50 doom targets to $250+ blue‑sky scenarios. ^[55]

If you’re considering PLTR today, it’s worth asking yourself three questions:

1. Do you believe enterprise and defense AI demand can support Palantir’s current growth trajectory well into 2026–2030?
2. Are you comfortable owning a stock that can swing 20–30% in either direction in a matter of weeks?
3. Does Palantir fit your portfolio as a concentrated bet, or only as a smaller, high‑beta satellite position?

Whatever your answer, Palantir has clearly moved beyond being a niche defense contractor. It is now a system‑level AI player sitting at the intersection of national security, critical infrastructure, and corporate transformation — and its stock will likely remain one of the market’s most hotly debated tickers for years to come.

References

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