Morgan Stanley Raises Palantir Price Target to $233

Morgan Stanley analyst Sanjit Singh raised the price target on Palantir (NASDAQ: PLTR) to $233 (from $205) while maintaining an Equalweight rating.

“The growth and profitability acceleration at Palantir keeps going with revenue accelerating for a remarkable 13th quarter in a row to +96% coupled with operating margins expanding nearly 1,100 bps YoY to 61.7% resulting in rule of 40 score of 158% .

Revenue was powered by robust US commercial growth of +148% (vs +149% in Q2) and in acceleration in U.S. government growth to +96% (from +90% in Q2).

While the streak of top-line improvement continues, the theme of the earnings call is how sovereign AI movement is translating to another inflection in Palantir’s business.

Sovereign AI specifically refers to how Palantir enables customers to post-train open-weight models on their own operational data and ontology, allowing them to realize better performance while retaining control of their models and data.

Furthermore, as the ROI of AI takes central focus, the sovereign AI approach is making more use cases economically viable while lowering overall costs.

Our recent work on open-weight models (see How Will Rising Open-Weight Model Adoption Impact Software?) suggest that the momentum with respect to adoption is significant and we believe Palantir’s strengths around solving the enterprise context problem with Ontology and enabling model choice with Evolve position the company as a primary beneficiary of this trends.

As a result, we raise our 2027 revenue growth/operating margin forecast to +65%/63.5% from +45%/61.0% and raise our price target to $233 from $205 prior.”

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