Palantir Technologies Inc.NASDAQ:PLTR
Published 2026-08-05, with market data as of the 2026-08-04 close. Financials are sourced from Palantir's Q2 2026 report (issued after market close on 2026-08-03) and public filings.
Palantir crushed the bears with a report that beat across the board and raised guidance sharply: Q2'26 revenue of $1,935M (+93% YoY), GAAP net income of $1,062M (+225%, per 10-Q), EPS of $0.41 (a 17.1% beat); U.S. commercial revenue of $764M (+149%) and U.S. commercial RDV of $6.24B (+124%). Management raised FY26 revenue guidance from $7.65B to $8.15-8.16B (+82%), and CEO Alex Karp said the momentum 'looks set to last at least 18 months.' On August 4 the stock soared 29.45% to close at $162.66 in an epic short squeeze (shorts marked-to-market losses of ~$3B in a day), its biggest single-day gain since February 2024.
But we caution: the stock got more expensive after the surge — about 47.9x FY26E sales and 139x trailing GAAP EPS ($1.17), a valuation that assumes 80-90%+ growth with little room for error. We rate PLTR Buy with Medium conviction and a 12-month target of $180 (+10.7% vs spot): U.S. commercial growth of +149% and U.S. commercial RDV +124% are real (sovereign AI plus the AIP Evolve product line), but weak international growth (19% of revenue, +33.7%), the 139x P/E, and the potential disruptive threat of large models (OpenAI/Anthropic) on the application layer cap the upside.
§01Investment Summary
Palantir's Q2'26 report settled the debate over whether enterprise AI has crossed the pilot phase: revenue +93%, U.S. commercial +149%, U.S. commercial RDV +124%, guidance raised by $0.5B — hard proof that its AIP platform is converting large models into auditable, executable production actions (the 'last mile from model to business value'). The single-day +29.45% on August 4 was both a fundamental re-rating and a mechanical short squeeze (shorts went from ~$2.7B paper gains to ~$3B paper losses in a day). We cross-check three FY26E-revenue P/S scenarios (35/53/68x) to a probability-weighted 12-month target of $180.
Three reasons to Buy: (1) Q2'26 beat across the board and FY26 guidance was raised by $0.5B (+82%), with Q3 guidance of $2.16B well above the ~$2.0B expected; (2) U.S. commercial +149% and U.S. commercial RDV of $6.24B (+124%), with sovereign AI (customers own and control data/models/infra) and AIP Evolve (AI agents optimizing compute cost) forming a differentiated product story, and the CEO saying momentum lasts at least 18 months; (3) crowded shorts (pre-earnings paper gains of $2.7B) have already suffered one squeeze, and the fundamentals-driven re-rating may continue.
Three key risks: (1) extreme valuation —
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