Palantir Technologies (PLTR 0.11%) started as many companies do: Its founders (Peter Thiel, Stephen Cohen, Joe Lonsdale, and current CEO Alex Carp) couldn't find the right solution for their needs. In this case, they needed software technology that allowed collaboration without sacrificing data security. That led them to start building Palantir in 2003.
At its core, Palantir Technologies is a software company. It builds digital infrastructure to help organizations better manage their secure data. Its focus on data security has made it a key software provider for the U.S. government and large corporations.
Palantir has also begun leveraging its expertise in data by providing customers with artificial intelligence (AI) solutions to help them get the most from their data. The company launched its Palantir Artificial Intelligence Platform (AIP) in 2023. It has quickly become an AI leader, with unrelenting demand for its leading capabilities.
Palantir's AI-driven growth potential might have you wondering how to invest in its stock. Here's a step-by-step guide on how to buy stock in the data software company and some factors to consider before adding shares to your portfolio.
Stock Ticker
How to buy
How to buy Palantir Technologies stock
Investors considering buying Palantir Technologies stock will need to take a few steps before becoming shareholders. This six-step guide will show you how to add the data software company to your portfolio:
- Open your brokerage app: Log in to your brokerage account where you handle your investments.
- Search for the stock: Enter the ticker or company name into the search bar to bring up the stock's trading page.
- Decide how many shares to buy: Consider your investment goals and how much of your portfolio you want to allocate to this stock.
- Select order type: Choose between a market order to buy at the current price or a limit order to specify the maximum price you're willing to pay.
- Submit your order: Confirm the details and submit your buy order.
- Review your purchase: Check your portfolio to ensure your order was filled as expected and adjust your investment strategy accordingly.
Should I invest?
Should I invest in Palantir Technologies?
Examining all the data and doing your due diligence is essential before buying shares of any company. This process might confirm your investment thesis or change your mind about buying shares.
Here are a few factors that could lead you to buy shares of Palantir:
- You strongly believe Palantir's stock will outperform the S&P 500 over the next three to five years.
- You're a buy-and-hold investor who plans to own Palantir shares for several years.
- You believe Palantir's AI platform will continue to be a huge growth driver.
- You think Palantir's profitability will continue improving.
- You believe Palantir can grow into its rather lofty valuation.
- You prefer to invest in cash-rich, debt-free companies generating growing free cash flow.
- Investing in Palantir would help diversify your portfolio.
- You like to invest in founder-led companies.
- You don't need dividend income from your investment.
Buy-and-Hold Strategy
On the other hand, here are some things that might lead you away from buying its stock:
- You're not exactly sure what Palantir does.
- You're not convinced Palantir can deliver market-beating returns in the coming years.
- You think AI is a fad.
- You're a more value-focused investor and think Palantir trades at a very high valuation.
- You already own several technology stocks.
- Given the country's deficits and debt, you're concerned about Palantir's exposure to the U.S. government (more than 40% of its total revenue in the first quarter of 2025).
- You're in or nearing retirement and need income-generating investments.
Profitability
Is Palantir Technologies profitable?
Crunching the data on a company's profitability is crucial to researching a stock. Historically, profit growth is a key driver of stock price returns over the long term. Here's a closer look at Palantir Technologies' profitability.
Palantir Technologies' earnings are growing rapidly. The company's generally accepted accounting principles (GAAP) net income was $214 million ($0.08 per share) in the first quarter of 2025, more than double the $105 million from a year earlier.
Palantir is also generating growing free cash flow. It produced $370 million of adjusted free cash flow during the first quarter of 2025 (a robust 42% margin). That grew its cash balance to more than $5.4 billion at the end of the third quarter (including cash, equivalents, and short-term U.S. Treasury securities). The balance allowed the company to start returning cash to investors via a $1 billion share repurchase program in mid-2023.
The company believes its revenue, earnings, and cash flow will continue growing, driven by robust demand for its AIP. That growing profitability could help drive its share price higher in the future.
Dividends
Does Palantir Technologies pay a dividend?
Palantir Technologies had not yet started paying a dividend as of mid-2025. While the data analytics company hadn't started making dividend payments, it had begun returning cash to shareholders.
Given that it has only recently started earning a profit and launched a share repurchase program, the company likely won't initiate a dividend anytime soon.
ETF options
ETFs with exposure to Palantir Technologies
Investors who are unsure whether they want to invest directly in Palantir stock can still gain some exposure to the data software company. An alternative strategy is to make a passive investment by purchasing a fund that holds its stock. One of the most common passive investment vehicles is an exchange-traded fund (ETF).
Exchange-Traded Fund (ETF)
According to ETF.com, 374 ETFs held more than 390.4 million shares of Palantir Technologies as of mid-2025. The Vanguard Total Stock Market ETF (VTI 0.51%) was the biggest holder, with more than 66.6 million shares. However, the fund had only a small allocation to Palantir, so it might not be the best way for investors to gain passive exposure to the data company.
On the other hand, the REX AI Equity Premium Income ETF (AIPI 0.52%) had the biggest allocation, at 9.4%. Palantir was the fund's third-largest holding, making the ETF a potentially attractive alternative option for investors seeking exposure to the data software company.
Stock splits
Will Palantir Technologies stock split?
Palantir Technologies didn't have an upcoming stock split on the calendar as of mid-2025. The data specialist had not completed a stock split since its direct public market listing in 2020.
Shares of Palantir surged in 2024 and through mid-2025, reaching around $135 towards the end of June. That was their highest level since going public. The stock had rocketed by more than 1,300% since its listing. If shares continue rising, Palantir might need to consider a stock split.
Related investing topics
The bottom line on Palantir Technologies
Palantir Technologies co-founder and CEO Alex Karp is extremely optimistic about the future. In the company's first-quarter 2025 earnings release, he stated: "We are in the middle of a tectonic shift in the adoption of our software.” Karp also noted that: "We are delivering the operating system for the modern enterprise in the era of AI."
There's a lot of competition in the AI space. However, Palantir has positioned itself as an early winner. That makes it a potentially compelling investment opportunity for those seeking exposure to the AI megatrend.
FAQ
Investing in Palantir Technologies FAQ
Is Palantir a good stock to invest in?
According to Wall Street analysts who follow the company, Palantir had a consensus rating of "hold" as of July 2025. Its stock price at the time (around $135) was well above the average analyst 12-month price target of $101.32 per share.
However, that doesn't mean you should follow their advice and hold shares. Those who believe Palantir's AIP will be a major growth driver might still want to buy shares. Conversely, people needing dividend income or concerned about valuation might wish to sell and invest that money in another stock.
What is a fair price for Palantir stock?
The consensus 12-month price target among analysts who cover Palantir was $101.32 per share as of July 2025. The highest price forecast was $155 per share, while the lowest was $40 per share. That compares to a stock price of around $135 a share at that time.
Is Palantir a public company?
Palantir Technologies is a publicly traded company. It trades on the NASDAQ under the stock ticker PLTR.
Does Palantir pay a dividend?
Palantir did not pay dividends as of mid 2025. However, the company had started returning cash to investors. Its board authorized a $1 billion share repurchase program in mid-2023.
Where will Palantir be in 5 years?
No one can accurately predict where Palantir will be in five years. Some highly ranked investors believe its share price could top $250 or even $500 in five years. Driving those bullish views is the potential for accelerated growth due to the immense market size for generative AI.
However, others are less optimistic about the stock's future due to the company's current valuation, which is very high.
Given this, there's a range of outcomes for Palantir. There is the potential for shares to more than double in five years if everything goes as planned. It's also possible that the stock could underperform if its growth rate slows. Palantir is a higher-risk stock with high reward potential.
Could Palantir be the next Nvidia?
Yes, Palantir could be the next Nvidia. The company is growing extremely fast. Its revenue jumped 39% in the first quarter of 2025. It's also growing its profitability and margins. That growth has driven the stock higher, much like Nvidia's AI-powered growth has fueled the surge in its stock price in recent years. If Palantir continues to deliver strong revenue and profit growth, it could follow in Nvidia's footsteps and become a massive growth stock.
However, if its growth starts to slow, then it will likely fall short of delivering Nvidia-like returns.
What is the rule of 40 in Palantir?
The Rule of 40 is a financial metric used for measuring software as a service (SaaS) companies. It suggests that a healthy SaaS company should have a combined revenue growth rate and profit margin of 40% or above. During the first quarter of 2025, Palantir had an exceptional Rule of 40 score of 83%.
