The artificial intelligence boom has been a game-changer, helping many tech stocks, including Palantir Technologies, deliver mouth-watering returns.
While the S&P 500’s 24% return in 2024 is impressive, it pales compared to the 340% return for Palantir’s shares. More amazing, while the S&P 500 has slumped 3% in 2025, Palantir’s stock price is up 63% — a remarkable accomplishment given this year’s tariff-driven volatility.
Palantir’s success likely surprised many people, but Wall Street veteran analyst and trader Stephen Guilfoyle wasn’t among them.
Guilfoyle picked up shares in 2023 when they were about $16, and he’s correctly banged the drum on Palantir’s potential ever since, including earlier this year, when he set a $122 price target.
Palantir reached that target on May 2, prompting Guilfoyle to update his outlook, including a new price target investors should consider given his past success.
Alex Karp, chief executive officer of Palantir Technologies, has seen shares soar thanks to booming artificial intelligence demand.Image source: Bloomberg/Getty Images
Guilfoyle bought Palantir stock in 2023 because of its strong, debt-free balance sheet, free cash flow, and likely earnings potential.
The outlook for the Peter Thiel-founded company, which CEO Alex Karp runs, has improved even more since then.
After OpenAI’s ChatGPT became the fastest app to reach one million users following its launch in December 2022, there has been a flood of interest in developing AI chatbots and agentic AI applications across most industries.
Banks are deploying AI programs to hedge risks, evaluate loans, and price products. Drugmakers are considering its use to predict drug targets and clinical trial outcomes. Manufacturers are seeing if it can boost production and quality. AI may also help retailers forecast demand, manage inventories, and curb theft. The U.S. military is even testing AI’s use on the battlefield.
AI’s use cases seem boundless, prompting many companies and governments to leverage Palantir’s deep expertise in managing and protecting data to help train and run new AI apps.
Palantir (PLTR) started by helping the U.S. government design counterterrorism systems. Its Gotham platform assists governments in those efforts today. The company also sells solutions to manage, interpret, and report data to large companies across enterprise and cloud networks.
Its experience managing and securing data has positioned it perfectly to help users design large language models and other AI solutions using its AI platform (AIP).
“The demand for AIP is unlike anything we have seen in the past 20 years,” said CEO Alan Karp in 2023.
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He wasn’t kidding. Demand for AIP solutions has skyrocketed, driving Palantir’s revenue, earnings, and stock price higher.
“We closed a record-setting number of deals in Q4, including 32 deals worth $10 million or more. Our U.S. business is at the forefront of the AI revolution, growing 52% year-over-year in Q4,” said Karp on Palantir’s fourth-quarter earnings conference call.
In that quarter, revenue rose 36% year-over-year, bringing full-year growth to 29%. It also made the jump to profitability in 2024, reporting adjusted earnings per share of 7 cents and full-year EPS of $0.41. It produced $1.25 billion in adjusted free cash flow in 2024.
Those results clearly validated Guifoyle’s bullish thesis in 2023, and his optimistic take on shares when he picked Palantir as his favorite stock in 2024, his single best stock pick one year ago, and made it his favorite stock for 2025 in December.
The rapid rise of AI last year included the most research and development and IT infrastructure activity and spending since the internet boom.
The pace of activity was so rapid that many worried demand was being pulled forward, likely causing a retrenchment in spending this year. Those concerns were amplified by reports of Microsoft and Amazon rethinking their data center buildout plans and the launch of higher-than-expected tariffs by the Trump administration, raising recession risks.
That backdrop caused Palantir’s shares to retreat significantly. However, the company’s stock has rocketed since April 9, when President Trump paused the implementation of reciprocal tariffs for 90 days, kick-starting a significant stock market rally.
The volatility in its shares has created plenty of buy and sell opportunities over the past year.
“I am buying PLTR for myself, for my kids, and for future generations of Guilfoyles. I have since shaved my long equity position at target prices when met and reloaded even more shares than I had sold on selloff,” said Guilfoyle in a TheStreet Pro post. “I sold shares with a $113 handle in February and bought back two-and-a-half times the number of shares sold from $102 down to $68. The stock bottomed at $66.12 on April 7.”
His early April buys have panned out nicely, and shares have now eclipsed his $122 price target.
Guilfoyle says he will sell some of his shares to lock in the recent gains, but Palantir remains a long-term holding, and his new price target is significantly higher.
“We’ll feel pretty foolish if a stock trades at our target, especially ahead of a known new event, and then sells off,” said Guilfoyle. “I will make a small sale with the expectation that I will be able to at some point add what I sold, plus maybe a little more at a lower price.”
Guilfoyle thinks Palantir stock could climb significantly on its next leg higher.
“My new $153 target price is now the highest target price for this name on Wall Street by a wide margin,” said Guilfoyle.
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