Deutsche Bank raised its price target on Palantir Technologies Inc. (NASDAQ:PLTR) to $200.00 from $160.00 on Tuesday, though the bank stopped short of upgrading its rating and left the stock at Hold.
The firm said the higher target stems from increased conviction in Palantir’s business model and prospects, based on discounted cash flow analysis. Deutsche Bank added that "the possibility of Palantir growing into its multiple is becoming more likely," citing projections out to 2027 used in its valuation work.
Analysts at the bank pointed to a range of financial metrics supporting a more favorable view, while also flagging valuation constraints that justify the Hold stance. InvestingPro data cited by the bank shows Palantir trading at a price-to-earnings ratio of 364.88 and a price-to-book ratio of 57.04, levels that leave limited margin for error.
Deutsche Bank highlighted an enterprise-value-to-unlevered-free-cash-flow multiple near 70 times based on 2027 estimates. The bank noted that when stock-based compensation is included in free cash flow calculations, the multiple expands to roughly 93 times, underscoring how accounting choices affect perceived valuation.
Several operating and balance-sheet metrics were called out in the bank’s assessment. Palantir reported strong gross margins, with InvestingPro data indicating a gross profit margin of 80.81%. The company is also expected to report net income growth this year, according to the same data set.
Cash generation and liquidity were central to Deutsche Bank’s reasoning. Palantir’s cash balance stands at $7.2 billion, and the company’s current ratio is reported at 6.43, suggesting liquid assets comfortably exceed short-term obligations. At the same time, Palantir has outlined a relatively modest $75 million share buyback for calendar year 2025, a level the bank said is drawing interest among shareholders who favor capital returns.
Top-line momentum remains pronounced. Revenue climbed 47.23% over the last twelve months, and the company has posted a five-year compound annual growth rate of 31%, figures Deutsche Bank used to underpin its DCF-based target increase.
Market backdrop and other analyst moves
Palantir’s stock has delivered a notable 76.45% return over the past year, though it fell 10.83% in the most recent week, according to InvestingPro data cited in analyst reports.
Recent earnings also attracted a range of responses from sell-side firms. Palantir reported fourth-quarter revenue of $1,407 million, a 70% year-over-year increase that beat HSBC’s estimate of $1,342 million and the consensus forecast of $1,340 million. Following the report, HSBC moved to upgrade the stock from Hold to Buy and raised its price target to $205.00.
Other broker reactions varied. UBS trimmed its price target to $180.00 while keeping a Neutral rating, despite describing the company's financial results as "astounding." Truist Securities reiterated a Buy rating and set a $223.00 price target, labeling Palantir a strong AI-focused contender. Cantor Fitzgerald kept a Neutral rating with a $198.00 target and cited impressive margins and a 5% overall beat in fourth-quarter results. DA Davidson lowered its target to $180.00 from $215.00 while maintaining a Neutral rating, referencing robust U.S. demand for Palantir’s AI offerings.
What this means for investors
Deutsche Bank’s lift in the target to $200 signals growing faith in Palantir’s ability to generate cash and expand its business, yet the Hold rating reflects continuing concern about valuation multiples and the pace of capital returns. The mix of upgrades, downgrades and target adjustments from other firms illustrates a market still divided on how to weigh rapid revenue and margin gains against very high multiples and limited buyback activity.
Investors and market participants will likely continue to monitor Palantir’s operating leverage, conversion of revenue into free cash flow, and any changes to capital-allocation plans as the company moves through the year.