Palantir (PLTR) Stock Surges 13% as Defense AI Becomes Priority Amid Iran Crisis

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PLTR shares rose 5.8% on Monday, marking a 13% climb across four consecutive trading sessions amid escalating US-Israeli strikes on Iran.
Wall Street saw eight firms upgrade Palantir during last month’s 38% correction from November’s all-time high.
Rosenblatt Securities lifted its price target from $150 to $200, pointing to conflict-driven demand for AI defense platforms.
A government mandate issued February 27 phases out Anthropic’s AI models from federal use within six months, creating potential opportunities for Palantir.
Analyst coverage shows 20 of 31 firms now assign buy ratings to PLTR, a significant increase from nine buy ratings in early January.

Palantir Technologies has weathered a challenging period recently. Between November 3’s record peak and February 24, shares plummeted 38%, weighed down by steep valuation multiples and public scrutiny surrounding its ICE and Department of Homeland Security partnerships. The selloff intensified when prominent investor Michael Burry questioned the company’s long-term growth trajectory.

Palantir Technologies Inc., PLTR

However, sentiment has reversed dramatically.

Military action by the US and Israel targeting Iran triggered a sharp rebound in PLTR shares last week. Monday’s session alone delivered a 5.8% gain, extending the four-day advance to 13%. The Trump administration indicated the conflict may persist for weeks, while Iranian leadership suggests an even longer timeframe.

For a business generating approximately 50% of revenue from US government and defense contracts, such geopolitical developments carry significant weight.

“The stock’s positive momentum reflects an emotional response to Palantir’s strategic positioning within government and military frameworks,” explained Tim Pagliara, chief investment officer at Capwealth Advisors. “The conflict underscores how deeply integrated the company has become with government operations and the competitive advantage that creates.”

This surge follows a substantial wave of analyst endorsements. Last month brought eight rating upgrades from major firms including UBS, Mizuho, HSBC, Baird, and William Blair. Current coverage shows 20 of 31 analysts maintaining buy ratings, with the average price target near $190 — suggesting roughly 31% potential appreciation from Monday’s closing price.

In early January 2026, only nine analysts recommended buying the stock. The transformation is striking.

Rosenblatt Pushes Target to $200

Rosenblatt Securities delivered one of the most aggressive calls. The firm increased its price objective from $150 to $200 while maintaining its Buy recommendation, emphasizing global instability and rising demand for conflict-ready technology solutions. Analyst John McPeake at Rosenblatt anticipates the Middle East situation will demonstrate the superiority of Palantir’s comprehensive platform compared to isolated large language model offerings.

The revised target applies a 1.2x price-to-earnings growth multiple, elevated from 0.9x, calculated against 88 times projected 2027 earnings. Rosenblatt continues to maintain the highest financial projections for Palantir’s 2027 performance among Street analysts.

The firm also highlighted a significant policy development: on February 27, federal agencies received orders to discontinue use of Anthropic’s AI systems, following Anthropic’s February 26 statement that its models shouldn’t power fully autonomous weapon systems. A six-month transition away from Anthropic’s large language models began immediately. Operation Epic Fury launched at 01:15 ET on February 28.

Rosenblatt views this as a strategic advantage for Palantir.

Solid Earnings Foundation

The upgrade cycle stems from concrete fundamentals. Palantir’s latest quarterly results exceeded analyst expectations, with revenue guidance substantially above consensus forecasts. The company’s projected 73% revenue expansion over the coming 12 months ranks fifth-highest across the entire S&P 500.

In a February 26 research note, UBS analyst Karl Keirstead described Palantir as “the premier growth story in software,” noting that the valuation has reached “a level that many investors can make a strong valuation case for the stock.”

Valuation metrics remain elevated. PLTR currently commands approximately 104 times forward earnings and 45 times projected sales — positioning it as the S&P 500’s most expensive stock on a price-to-sales basis. The price-to-earnings ratio reached 247 times as recently as October 30.

Shares closed at $145.17, representing a 30% decline from the 52-week peak of $207.52, though still up 74% year-over-year.

According to InvestingPro data, seventeen analysts have raised their earnings projections for the upcoming reporting period.

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