By Mackenzie Tatananni

There has been no shortage of noise around Palantir Technologies, particularly concerning its sky-high valuation. But some bulls say its artificial-intelligence-fueled expansion is set to continue.

One optimist is Citi Research analyst Tyler Radke, who upgraded shares to Buy from Neutral and lifted his price target to $235 from $210 in a note Monday.

Palantir shares rose 0.8% to $178.94 in premarket trading.

The stock gained 135% in 2025, far outstripping a 16% gain for the S&P 500. After a stellar year, Radke expects gains to continue into 2026. With "vicious growth acceleration and equally impressive margin expansion," Palantir has "broken" traditional rule-of-40 and valuation frameworks, the analyst argued.

As of Friday's close, Palantir stock was trading at a forward price-to-earnings ratio of 177.61. The benchmark index, by comparison, was trading at 22.49 times forward earnings. But Radke believes not just that Palantir's valuation is palatable, but that the stock will continue to rise. It will be bolstered by 2026 themes around enterprise AI and growing traction of AI agents, as well as "the renewed urgency around Defense globally," all of which suit Palantir's strength in data ontology, he said.

Write to Mackenzie Tatananni at mackenzie.tatananni@barrons.com

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January 12, 2026 08:17 ET (13:17 GMT)

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