Palantir, IBD Stock Of The Day, Forging Lower Buy Point After December Gains

Palantir Technologies (PLTR) is the IBD Stock Of The Day for Wednesday. Despite a solid intraday decline, shares of the data analytics software company have formed a cup base with their rebound in December. Palantir stock slid 16% last month.

On the stock market today, Palantir stock fell 5.6% to close at 177.29. Shares have gained more than 5% in December following a slump last month and remain ahead more than 137% so far this year.

Palantir reported third-quarter earnings that beat expectations at the start of November. But Palantir stock fell following the report, which one analyst attributed to “rally exhaustion.” Palantir stock has soared over the past three years amid optimism about AI data demand. Shares are also helped by the view that the company is poised to win more U.S. government business during the Trump administration.

But AI stocks in general pulled back from highs in November as Wall Street grows more cautious about the sustainability of the tech megatrend. Other stocks seen as benefiting from AI were down on Wednesday, including Nvidia (NVDA), Oracle (ORCL) and CoreWeave (CRWV).

Analyst View On Palantir

Palantir makes data analytics tools for government and enterprise customers. Palantir aims to use generative AI to spur growth in the U.S. commercial market, such as health care and financial services. Here’s further background for investors to know about Palantir.

Palantir’s valuation makes it a much debated stock on Wall Street. Of the 27 stock analysts following the company, Palantir stock has seven buy calls, 17 neutral ratings and three sell warnings, according to FactSet.

Analysts with Mizuho reiterated a neutral call on Palantir in a 2026 preview notes for the software sector on Tuesday.

“Palantir’s recent execution and momentum is stunning, including material upward revisions across its commercial and government segments,” Mizuho analysts led by Gregg Moskowitz wrote. “That said, we are equally stunned by the multiple that Palantir has attained, which places its valuation dramatically above anything else in software. We are cognizant that the shares could suddenly be subject to material multiple reversion at some point over the next few quarters, although this is balanced by Palantir’s uniqueness that demands tremendous credit. And looking forward, we believe Palantir is increasingly well-positioned to benefit from long-term trends in AI, government digital transformation, and industrial modernization.”

Mizuho stuck by a 205 price target for Palantir stock with its report.

Palantir Stock In Cup Base

The IBD MarketSurge chart tool shows Palantir stock has formed a cup base with a buy point of 207.52. But the stock is on track to have a handle after Wednesday’s close, lowering the official entry to 190.39.

The stock is about 12% off a record high from early November. But with its December gains, Palantir stock clawed back above both its 21-day exponential moving average and its 50-day moving average, both key technical levels. However, shares were testing both levels with Wednesday’s decline.

For its December-ending fourth quarter, analysts forecast that Palantir’s adjusted earnings will increase 64% to 23 cents per shares. Sales are seen rising 60% to $1.32 billion, according to FactSet.

Earnings growth has accelerated for the past two quarters, with 110% in Q3. Sales gains have ramped up for many quarters, reaching 63% in the latest period.

Meanwhile, Palantir stock holds a best-possible Composite Rating of 99, according to IBD Stock Checkup. IBD’s Composite Rating combines five separate proprietary ratings into one easy-to-use rating. The best growth stocks have a Composite Rating of 90 or better.

Further, Palantir’s Relative Strength Rating stands at 95 out of a best-possible 99, ticking up form a score of 93 four weeks ago, according to MarketSurge.

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