Jim Cramer: "Palantir (PLTR) will definitely break $250"...Will a 40% surge materialize?

▲ Palantir (PLTR)/AI-generated image

American broadcaster Jim Cramer reaffirmed Palantir Technologies (PLTR)'s price target at $250, forecasting an additional surge of over 40%. This aggressive outlook is driven by artificial intelligence (AI) demand, despite Wall Street's general caution and extreme valuation debates.

According to BeInCrypto on September 18 (local time), Jim Cramer, host of CNBC's "Mad Money," reiterated his $250 price target for Palantir. Considering Palantir's recent trading around $175, this analysis suggests an upside potential of approximately 43%. However, as the 'Inverse Cramer' meme, where investors bet against his stock recommendations, is widespread in the market, a degree of market caution regarding his optimism also persists.

Some major Wall Street brokerages have also recently raised Palantir's price target, lending weight to Cramer's view. Karl Keirstead, an analyst at Swiss investment bank UBS, increased his price target from $220 to $250, and Gil Luria of D.A. Davidson also raised his from $200 to $250. Both cited the growing demand for 'sovereign AI,' which runs AI on proprietary infrastructure instead of external clouds, and strengthened supply chain software collaboration with NVIDIA (NVDA) as key reasons. Palantir's second-quarter revenue surged 93% year-over-year to $1.94 billion, significantly exceeding market expectations.

In contrast, Wall Street's consensus remains far more conservative than Cramer's optimistic outlook. The average 12-month price target from 23 analysts, compiled by financial information platform TipRanks, stands at $202.11. Seventeen analysts issued a "buy" rating, four a "hold," and two a "sell," with the most pessimistic forecast being just $80, less than half of the current stock price.

The extreme overvaluation burden is identified as the biggest hurdle for the stock price. Palantir's price-to-earnings ratio (PER) is approximately 149 times based on past performance, making it a prime target for short sellers like Michael Burry. While Palantir CEO Alex Karp appeared on television to urge the establishment of strict AI regulatory guidelines, it is assessed that sustained growth in private commercial sector orders is necessary for Cramer's price target to be reached.

[Article Summary]

-CNBC host Jim Cramer reaffirmed Palantir (PLTR)'s price target at $250, forecasting an additional 43% surge.

-Some brokerages, including UBS, agreed, citing sovereign AI demand and NVIDIA (NVDA) collaboration, but Wall Street's average price target remained at $202.11.

-Amid a high PER of 149x and ongoing valuation concerns, the sustainability of private sector orders will determine the future direction of the stock price.

*Disclaimer: This article is for informational purposes only and does not take responsibility for investment losses based on it. The content should be interpreted solely for informational purposes.*