AI-linked equities are diverging sharply as Palantir Technologies attracts bullish analyst coverage while Alphabet suffers a historic one-day selloff. Palantir shares fell 1.56% to $193.73 on Thursday, about 7% below their record closing high of $209.05 from October 9. The stock has gained about 11% this year through Wednesday after rallying more than 130% in 2025 and 56% since its second-quarter earnings report on August 3. JPMorgan initiated coverage with an Overweight rating and a December 2027 price target of $262, implying roughly 33% upside from the prior close of $196.81, and added the stock to its positive catalyst watch before Palantir’s November 2 earnings.
JPMorgan analyst Brian Essex argued that enterprises are moving from AI experimentation to return-focused deployment, and Palantir is already delivering measurable ROI. “Palantir takes AI past the point of simply automating processes performed by humans,” Essex wrote, adding that its platform can transform business operating models. Morgan Stanley maintained an Equal Weight rating and $205 target, while Baird reiterated Outperform with a $250 target and said revenue growth could accelerate for a 13th consecutive quarter. Rosenblatt lifted its target to $260 from $225 and kept a Buy rating.
Valuation remains a key concern. Palantir trades at a forward price-to-earnings ratio of about 89.38, compared with 18.93 for the S&P 500.
Alphabet’s third-quarter report triggered a far sharper reaction. GOOGL closed at $283.82 on Thursday, down 12.64% or $41.07, which CNBC described as the stock’s worst day on record and a loss of about $500 billion in market value. In Friday premarket trading it slipped another 1.09% to $280.74. Revenue rose 25% to $127.58 billion, and Google Cloud grew 103% to $30.71 billion, but Search and other revenue increased only 12%, down from 17% in the second quarter. Diluted EPS was cut to $2.12 by an $8.66 billion loss on equity securities. Capital expenditure more than doubled to $51.36 billion, operating cash flow was $42.29 billion, and free cash flow was negative $9.07 billion, far weaker than the roughly negative $2.7 billion expected.
Alphabet kept 2026 capex guidance at $195 billion to $205 billion, and finance chief Anat Ashkenazi said spending will “increase significantly in 2027.” Target cuts followed from Cantor Fitzgerald to $350 from $420, Bank of America to $380 from $430, Goldman Sachs to $385 from $435, RBC to $400 from $425, and DA Davidson to $300 with a Neutral rating. Most firms kept Buy or equivalent ratings. The average analyst target fell to $408.09 from $429.68.
The selling extended across AI-linked equities: Amazon fell about 7% in premarket trading after its own spending-heavy quarter, Intel dropped about 25% after weak guidance, and South Korea’s KOSPI fell more than 5%. For crypto markets, the move is primarily a risk-sentiment signal rather than a direct fundamental catalyst, with no major coin-specific impact visible from these equity earnings.
