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Palantir Gets 'Buy' Rating, $37 Price Target

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  Published in Stocks and Investing on Thursday, February 19th 2026 at 16:46 GMT by Investopedia
      Locales: Colorado, New York, Virginia, UNITED STATES

By Elias Thorne | February 19, 2026

The data analytics firm Palantir Technologies (PLTR) has faced a turbulent ride in recent years, experiencing a significant decline from its peak in 2021. However, a recent note from Mizuho Securities is sparking renewed investor interest, with the firm initiating coverage with a 'Buy' rating and a $37 price target. This comes as the stock currently trades considerably below its previous highs, down approximately 35% from its 2021 peak of $31.08. But is now the time to buy, or is Palantir's slump a signal of deeper issues?

A Two-Pronged Business: Government Stability & Commercial Potential

Palantir's business model is uniquely structured around two core segments: government and commercial. For years, the company's strength has resided in its lucrative contracts with U.S. and international government agencies. These contracts, often involving complex data analysis for national security and intelligence purposes, provide a relatively stable revenue stream. This segment continues to perform well, offering a degree of resilience in an often unpredictable market. However, the real growth opportunity, according to Mizuho and increasingly, other analysts, lies within Palantir's commercial business.

Palantir's commercial offerings, including platforms like Foundry and Apollo, aim to empower businesses with powerful data integration and analytics capabilities. These platforms are designed to help companies make data-driven decisions, optimize operations, and gain a competitive edge. While the commercial sector has seen slower adoption rates than initially projected, Mizuho believes it's poised for significant expansion. The firm points to increasing enterprise demand for robust data analytics solutions as a key catalyst for growth. The company has been actively targeting industries such as finance, healthcare, and manufacturing, demonstrating the versatility of its platform.

Profitability Remains a Key Concern

Despite the optimistic outlook, Palantir hasn't been without its challenges. A consistent hurdle for the company has been achieving sustained profitability. While revenue has grown, operating expenses have often kept pace, impacting the bottom line. This is a critical area of focus for investors and analysts alike. Recent quarterly reports have shown some progress towards improved margins, but the company still needs to demonstrate a clear path to consistent profitability to fully win over skeptical investors.

The macroeconomic environment also plays a role. Economic uncertainty and potential recessions can lead businesses to tighten their budgets and delay investments in new technologies, potentially impacting Palantir's commercial growth. Interest rate fluctuations and inflation can also affect capital allocation strategies, potentially diverting funds away from companies like Palantir that are still investing heavily in growth.

Analyst Weigh-In and Market Sentiment

Mizuho analyst Brian Dobson's 'Buy' rating is based on the belief that Palantir's stock is currently undervalued, given its long-term growth potential. Dobson argues that the current market price doesn't adequately reflect the company's strong position in the data analytics space and its potential to capitalize on the growing demand for data-driven solutions. However, it's important to note that analyst ratings are not guarantees of future performance, and market sentiment can be fickle.

Several other analysts remain cautious, highlighting the need for Palantir to demonstrate consistent profitability and navigate the challenging macroeconomic landscape. Some point to the company's relatively high valuation compared to its earnings as a potential risk factor. The stock's volatility also adds to the uncertainty.

Looking Ahead: What to Watch in 2026 & Beyond

As of February 2026, investors are keenly observing several key factors that will likely shape Palantir's future. These include:

• Commercial Customer Acquisition: Tracking the rate at which Palantir adds new commercial customers and expands its existing relationships.
• Profit Margin Improvement: Monitoring the company's progress in improving its operating margins and achieving consistent profitability.
• Government Contract Renewals: Assessing the success of Palantir in securing renewals for its existing government contracts and winning new ones.
• Technological Innovation: Observing Palantir's continued development of innovative data analytics solutions and its ability to stay ahead of the competition.
• Macroeconomic Conditions: Evaluating the impact of broader economic trends on Palantir's business.

Palantir remains a complex and intriguing company. While the recent slump has raised concerns, Mizuho's 'Buy' rating suggests that the stock may present a compelling opportunity for investors willing to take on some risk. Ultimately, the decision to invest in Palantir will depend on individual risk tolerance and a thorough assessment of the company's fundamentals and future prospects.