Palantir Technologies (PLTR) was upgraded at Citi on Monday as the investment firm believes a commercial and government “supercycle” is coming this year.
Shares rose 0.7% in premarket trading.
“We are upgrading PLTR to Buy/High-Risk from Neutral and raising estimates and our target price to $235,” analyst Tyler Radke wrote in a note to clients. “Shares have minted spectacular returns over the last few years as a vicious growth acceleration and equally impressive margin expansion has ‘broken’ traditional rule-of-40 and valuation frameworks. Despite our 2025/26 revenue numbers up 10%+ since mid-year, the stock is ~flat. Our upgrade is premised on the 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. We also see significant tailwinds in the Government, driven by accelerating defense budgets and modernization urgency.”
Delving deeper, Rake said estimates for the fiscal 2026 government growth is at 51% year-over-year, or roughly 800 basis points above consensus, and the potential for 70% or more.
“This is driven by our view of a ramping defense super cycle and possible tailwinds from lapping the 2025 government shutdown and international (U.S. allies) modernization,” Radke added. “We will be closely watching Golden Dome and other major defense initiative announcements as potential catalysts through the year (though these should be larger 2027 numbers impacts).”