Palantir Technologies (PLTR) shares rallied sharply this week, ending a prolonged losing streak, after the company announced a strategic partnership with Nvidia to build custom AI models for the U.S. government. The stock rose 8.8% on Wednesday to $127.22, capping a four-day gain of roughly 19% from its June 25 low of $107.27. The rebound reversed a slide that had pushed PLTR down 39% year-to-date and 25% in June alone, triggered by fears that AI could displace software platforms like Palantir’s.
The Palantir-Nvidia collaboration aims to deliver a secure “intelligent engine” that combines Nvidia’s AI infrastructure and Nemotron models with Palantir’s data-integration platforms. CEO Alex Karp emphasized that the partnership gives government clients “control over their compute, their models, their data stack and their alpha,” with the Ontology platform ensuring precision and security for AI used on the battlefield.
Analyst sentiment turned bullish as DA Davidson upgraded PLTR to Buy from Neutral, lifting its price target to $175 from $165. The brokerage highlighted Palantir’s role as an “orchestration layer” that allows enterprises to switch between AI models without workflow disruption—a key advantage as organizations seek to avoid dependence on a single foundation-model provider. Morningstar also noted the pullback created a buying opportunity, with a fair value estimate of $153, implying 24% upside. Wolfe Research, initiating coverage with a Peer Perform rating, cited Palantir’s “best-in-class enterprise AI” but a premium valuation, projecting 39% revenue CAGR from 2026–2029.
Despite the surge, the stock remains about 25% below its 2025 peak. Morningstar’s base case sees Palantir’s total addressable market growing to $1.4 trillion by 2033, supporting five-year average annual revenue growth of 45% and gross margins in the 83%–85% range. The partnership also expands Palantir’s existing defense and intelligence footprint, reinforcing its public-sector moat.
