Goldman Sachs sees 18% upside for Palantir on sovereign AI growth

Goldman Sachs has upgraded Palantir Technologies (NASDAQ: PLTR) to a Buy rating, with a 12-month price target of $230.00, suggesting an 18% upside potential. Shares of the enterprise software company closed at $194.12 on Friday, with an increase of 2.5% to $199.05 following the analyst note. Analyst Gabriela Borges provided a significant boost for Palantir supporters, who have faced criticism from short sellers due to the stock's premium valuation.

Borges addressed two key debates surrounding Palantir's current $8 billion revenue run rate and 100% growth trajectory: whether the market has already factored in its AI opportunity, and whether its human-intensive Forward Deployed Engineer (FDE) model can scale efficiently. She concluded that the stock setup favors sustained growth.

Borges highlighted a shift in how enterprises are adopting AI, moving away from generic coding tools in 2025 and 2026 towards applying AI to proprietary data to amplify existing moats. This aligns with Palantir's concept of Sovereign AI, championed by CEO Alex Karp and echoed by Microsoft CEO Satya Nadella, which advocates for a number of AI models matching the number of distinct enterprises worldwide.

Palantir is expanding its sales momentum by securing high-profile clients across sectors like financial services and semiconductor industries. The company's Ontology architecture, which maps raw datasets into operational objects for humans and autonomous AI agents, makes it well-positioned to capture the shift in enterprise software market.

Despite underperforming the Nasdaq 100 year-to-date, Palantir's stock is viewed as an attractive entry point for the next leg of AI expansion by Goldman Sachs.