Palantir Technologies Inc. (PLTR) shares are edging higher Tuesday, trading around $182 as the company builds on a 7% rally over the past week. The momentum stems from strategic moves that position Palantir squarely at the intersection of AI innovation and infrastructure reality.
Why the Stock Is Moving
The main driver here is Chain Reaction, Palantir's newly launched operating system aimed at solving a problem that doesn't get enough attention: AI needs massive amounts of energy, and the infrastructure to deliver it is struggling to keep up. Working alongside Nvidia (NVDA) and CenterPoint Energy, Palantir is tackling U.S. power grid optimization and data center buildouts. Think of it as the unglamorous but essential plumbing work that makes the AI revolution actually possible.
This infrastructure play builds on some seriously impressive financial performance. Last month's third-quarter earnings crushed expectations, with revenue reaching $1.18 billion driven by a 54% jump in U.S. commercial revenue. The company posted a "Rule of 40" score of 114%, which is finance speak for achieving both high growth and profitability simultaneously—a combination rarer than you'd think in the tech world.
Bank of America analysts have been highlighting another encouraging sign: customer stickiness. The top three clients increased their spending by 40% year-over-year, suggesting Palantir's software becomes increasingly embedded in operations once customers adopt it.
Navigating the Skeptics
Not everyone's convinced, of course. Michael Burry, the "Big Short" investor who became famous betting against the housing market, has been making headlines recently for positions against both Palantir and Nvidia. He's revisited his viral 2023 "Sell" call on Palantir, adding some noise to the story.
Shares are still down about 6% over the past month following a mid-November dip, so the skepticism has left marks. But Palantir keeps expanding its commercial footprint beyond traditional government contracts. Recent partnerships include a niche AI deal with Teton Ridge for rodeo analytics, of all things—proof that the company is casting a wide net for new business.
Technical Picture Looks Strong
From a technical standpoint, things look healthy. Shares were up 0.12% at $181.72 at the time of publication Tuesday. More tellingly, the stock is trading roughly 27.9% above its 200-day moving average of $142.47. That's a sign of sustained bullish sentiment, especially since the stock has maintained its upward trajectory after breaking through that key technical level.
Growth and momentum scores paint a similar picture, with ratings of 95.95 and 94.12 respectively signaling robust technical health. The value rating of 1.03 is considerably lower, which makes sense—no one's arguing Palantir is cheap right now.
The question for investors is whether the company's expansion into AI infrastructure and continued commercial growth justifies the valuation, especially with prominent short sellers taking the other side of the trade. For now, the market seems to be betting that Palantir's combination of government relationships, AI positioning, and expanding commercial presence keeps the story intact.