Daiwa upgrades Palantir despite stock slump

Daiwa Capital Markets is now telling investors to buy Palantir, even though the stock has been a mess this year. Analyst Shigemichi Yoshizu thinks it still has room to bounce, even after dropping 20% since January. He lowered his price target from $200 to $180, but that still means there’s a 26% gain possible if the stock recovers.

The company reported strong fourth-quarter earnings last week, beating both revenue and profit estimates. Shares jumped 7% the next day. Shigemichi said, “The earnings release left a positive impression.

The company continued to see extraordinary demand for its AI platform services from both public and private sectors.” That’s exactly what helped Daiwa flip from neutral to buy.

Palantir gets a boost from U.S. commercial demand

What really caught Wall Street’s attention was the spike in Palantir’s U.S. commercial revenue, which rose 137%. The company expects that number to keep climbing. Shigemichi said clients aren’t just testing the software anymore. They’re now running operations with it.

He also wrote that the company is expanding quickly by adding more users, increasing contract lengths, and finding new ways for customers to use the platform. He added, “With the firm projecting U.S. commercial revenue up at least 115%, it reaffirmed the significant growth potential of future earnings.”

Even with that growth, Palantir keeps catching heat in the UK. Since 2023, the company has pulled in over £500 million in government contracts and hired Lord Mandelson’s Global Counsel to help with strategy.

Critics are pushing to get the company off public contracts altogether, saying it’s a black box when it comes to transparency.

One of the biggest deals came when Palantir landed a £330 million contract with the NHS to help organize health data. That partnership made people nervous. The company has ties to the Israeli military and U.S. immigration enforcement, including ICE, which has been blamed for deadly crackdowns on American soil. Those connections raised a lot of questions.

In June, the UK Government refused to share briefings sent to Keir Starmer before he and Mandelson visited a Palantir showroom in Washington DC. That refusal only made the backlash worse.

Government ties, IPO timeline, and sky-high valuation

In the U.S., Palantir is deep in government work. It builds AI tools and data platforms like Gotham and Foundry for military and intelligence agencies. The company recently landed a $10 billion deal with the Army. It’s also worked on battlefield surveillance, immigration data, and federal databases.

Before going public, Palantir wasn’t profitable. It filed for an IPO in July 2020 and listed directly on the New York Stock Exchange on September 30, 2020 using the symbol PLTR. Four years later, on November 26, 2024, it moved over to the Nasdaq, keeping the same ticker.

On September 6, 2024, S&P Global added the company to the S&P 500, and shares jumped 14% the next day. But in 2025, The Economist took aim, calling Palantir “the most over-valued firm of all time.” Its market cap hit $430 billion, over 600 times its earnings from 2024. As of November 2025, it was trading at 85 times expected sales, the most expensive stock on the index.

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