Citi believes that accelerating enterprise artificial intelligence adoption and government spending could drive further gains for Palantir , even after the stock's sharp run. The bank upgraded the software analytics provider to a buy rating from neutral. Analyst Tyler Radke also raised his price target to $235 from $210. Shares of Palantir have surged 164% over the last 12 months. Radke's revised price forecast implies an additional upside of 32% from here. PLTR 1Y mountain PLTR 1Y chart The analyst noted that Palantir has minted spectacular returns in the last few years, citing "vicious growth acceleration and equally impressive margin expansion" as drivers. However, Palantir's impressive rally seems to have plateaued in the last few months. "Despite our 2025/26 revenue numbers moving up 10%+ since mid-year, the stock is ~flat," Radke wrote. "Our upgrade is premised on our view that 2026 is poised to be another year of significant positive estimate revisions, with recent CIO + industry conversations suggesting AI budget and use cases are accelerating in the enterprise," the analyst added. "We also see significant tailwinds in the Government driven by accelerating defense budgets and modernization urgency." Radke said there could be an upside case for Palantir's total revenue growth to reach between 70% to 80% in 2026. An increased government defense budget also paints a strong upside case, Radke noted, with his government growth estimates for 2026 at 51% year over year. Besides a ramping defense super cycle, other possible tailwinds include lasting ramifications from the 2025 government shutdown and the modernization of U.S. allies. The analyst added that he will be closely watching the Golden Dome missile defense project and other major defense initiative announcements as potential catalysts for Palantir.
