High Expectations vs. Premium Valuation (2026)

The equity of Palantir Technologies was down by 8 % last week losing $28 billion of its market capitalization despite strong fourth-quarter earnings highlighting the sophisticated artificial-intelligence capabilities of the company. 

The shares closed at 143.20 on February 9, 2026, its market cap is $341 billion and trades at around 125 forward P/E ratio and a PEG ratio of 3.6. 

Good Measures of Performance

The fourth quarter was better than expected, as the revenue grew 70% annually. The U.S. commercial revenue increased by 137 %, the number of customers increased by 34 % and 61 deals worth more than $10 million were gained by the firm. The earnings per share increased 7.7 times to the earnings of $608.7 million or $0.25 adjusted EPS, and this is as compared to the Wall Street estimate of $0.23. 

Valuation Raising among Bearish Investors

Bearish analysts though have not been spared by criticizing the premium valuation level. The growth rate of international commercial revenue decreased to 8 % since CEO Alex Karp admitted in the Q4earnings call.

The Statement,

We really don’t have the bandwidth to do anything that’s difficult outside of America.

It’s not surprising that many Wall Street analysts doubt Palantir’s recent success will continue. In February, less than half of the analysts surveyed by S&P Global who cover Palantir recommended buying the stock.

Some may argue that Palantir isn’t operating at peak performance.

Timing Concerns as an Investment

Though the artificial-intelligence services offered by Palantir are still powerful, the stability of the company in performance depends on the valuation-dynamics management. Bank of America Securities reiterated its Buy rating and maintained its Street-high $255 price target, citing continued demand from government agencies and increased use by commercial customers.

The projections are forward looking that shows that the U.S commercial revenue may grow more  through quicker hiring but any slowdown would result in a more severe correction. 

Those investors, who are concentrated on the specific offer of the company, can see the opportunity, which is bullish, and the investors which are oriented on the value should pay attention to the price drops.