PLTR Analysis: The AI Operating System — Why Palantir's 34% Pullback From Highs Masks a Company Entering Hyper-Profitability
Palantir Technologies (NASDAQ: PLTR) just filed what may be the most important earnings report in its 22-year history — and the market barely noticed. On February 17, 2026, the company reported Q4 2025 revenue of $1.41 billion, a 59% year-over-year acceleration that pushed full-year revenue to $4.48 billion and operating margins above 40% for the first time. The stock sits at $137.15, up 3.1% on Wednesday following a Mizuho upgrade to Overweight with a $195 price target, yet still 34% below its 52-week high of $207.52. The disconnect between Palantir's fundamental trajectory and its current price creates a rare analytical puzzle. This is a company generating $2.1 billion in annual free cash flow, sitting on $7.2 billion in cash and investments with virtually no debt, and accelerating revenue growth in an environment where most enterprise software names are decelerating. Yet the stock trades at 217x trailing earnings — a valuation that demands not just strong execution, but sustained hypergrowth for years to come. The bull case is straightforward: Palantir's Artificial Intelligence Platform (AIP) and Ontology framework are becoming the de facto operating system for enterprises deploying agentic AI in production, a market with no clear second-place competitor. The bear case is equally clear: at 300x trailing sales, any stumble in growth or margin expansion gets punished severely. After analyzing the latest financials, competitive dynamics, and forward estimates, here is what individual investors need to know about owning Palantir at $137.