Palantir Just Landed a Fannie Mae Deal. Should You Buy PLTR Stock Here?
Valued at a market cap of $292 billion, Palantir (PLTR) is among the largest tech companies in the world. PLTR stock has surged close to 500% in the last 12 months and has rallied over 1,200% since its initial public offering in September 2020.
Investors and analysts are bullish on Palantir due to its accelerating revenue growth, improving profit margins, a widening portfolio of products, and expanding corporate partnerships.
Earlier this week, Fannie Mae (FNMA) launched an AI-powered Crime Detection Unit in partnership with Palantir to combat mortgage fraud in the U.S. housing market. The new platform utilizes artificial intelligence and machine learning to analyze millions of datasets, finding previously undetectable fraudulent patterns.
Early testing demonstrated the technology's effectiveness, identifying fraud in seconds that previously took human investigators two months to discover. The partnership initially focuses on Fannie Mae's multifamily housing business, with potential expansion to Freddie Mac (FMCC) under consideration.
Fannie Mae, which holds over $4.3 trillion in assets and owns or guarantees approximately 25% of single-family mortgages and 20% of multifamily mortgages nationally, believes this technology will save millions in fraud losses while protecting lenders, homebuyers, and taxpayers.
Palantir Is Gaining Traction in AI
Palantir recently announced two major partnerships expanding AI capabilities across the government and financial services sectors. Palantir's FedStart program will enable Anthropic's Claude AI application to serve millions of federal employees at FedRAMP High and DoD Impact Level 5 security standards.
This collaboration, hosted on Google Cloud (GOOGL) with multi-cloud flexibility through Amazon (AMZN) Bedrock and Vertex AI, will allow government workers to use Claude for writing, data analysis, and complex problem-solving while maintaining strict security compliance. The partnership builds on last year's agreement, where Anthropic partnered with Palantir through AWS for Impact Level 6 accredited environments.
Palantir also partnered with xAI and TWG Global (TWG) to revolutionize AI adoption in the financial services sector. The collaboration addresses the critical issue that 74% of companies remain stuck in proof-of-concept phases, yielding no meaningful returns. Its offering includes governance foundations, industry-tuned AI agent suites, and modular agentic workforces designed to deliver measurable business outcomes within 90 days'
Unlike traditional per-seat licensing models, the partnership operates on an outcome-based pricing model, aligning success with measurable results. The initiative combines xAI's advanced models and Colossus supercomputer with Palantir's operational expertise and TWG Global's implementation capabilities, targeting CEO-level engagement to deploy hundreds of thousands of AI agents across enterprises, resulting in transformative productivity gains.
Is PLTR Stock a Good Buy?
Palantir reported strong financial results for Q1 2025, showcasing remarkable growth across key metrics. It generated $884 million in revenue, representing 39% year-over-year growth.
U.S. operations drove exceptional performance, with total U.S. revenue surging 55% year-over-year to $628 million. U.S. commercial revenue grew 71% year-over-year to $255 million, surpassing a $1 billion annual run rate. The company closed 139 deals worth at least $1 million and booked a record U.S. commercial total contract value of $810 million, up 183% year-over-year.
Profitability metrics were equally strong, with GAAP income from operations reaching $176 million (a 20% margin) and adjusted income from operations reaching $391 million (a 44% margin). Palantir generated $310 million in cash from operations and $370 million in adjusted free cash flow.
CEO Alex Karp attributed success to delivering 'the operating system for the modern enterprise in the era of AI,' highlighting the company's early investment in AI platforms that were initially met with skepticism.
Based on strong performance, Palantir raised full-year 2025 guidance, projecting total revenue growth of 36% and U.S. commercial revenue growth of 68%. It expects Q2 revenue to be between $934 million and $938 million.
What Is the Target Price for PLTR Stock?
The ongoing rally in PLTR stock means it now trades at a lofty price-earnings multiple of over 200x. Out of the 20 analysts tracking PLTR stock, three recommend 'Strong Buy,' 12 recommend 'Hold,' one recommends 'Moderate Sell,' and four recommend 'Strong Sell.' The average target price for PLTR stock is near $94, below the current price near $122.
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