Rosenblatt expects Palantir shares to rise nearly 40% due to the Iran war

The US conflict with Iran clearly demonstrates the value of solutions from Palantir, which develops AI also for the military, according to Rosenblatt analysts. According to their forecast, this could lead to the growth of the company's shares by almost 40%.

Rosenblatt analyst John McPeak raised his target price on Palantir's stock from $150 to $200, suggesting a 37% upside potential relative to the company's March 3 close. The analyst set the previous target just a week ago, when he began coverage of this company with a recommendation to buy its securities, MarketWatch reports .

"The conflict in the Middle East is favorable for the government order book. The war, unfortunately, underscores the value of Palantir versus just another big language model," McPeek wrote in a March 3 note to investors. He believes the escalation is likely to demonstrate the company's "strength and leverage" compared to leading AI model developers like OpenAI and Anthropic.

Palantir shares were up 0.6% at the end of trading on Tuesday. The day before, they soared by almost 6%, also due to active purchases by retail investors, who used this paper just to bet on the defense sector.

Even before the conflict escalated, the U.S. Department of Defense said it intended to enter into "larger and longer-term contracts" for weapons systems whose effectiveness has already been proven, MarketWatch recalls. According to Stifel analyst Jonathan Siegman, an operation against Iran could accelerate that spending and make it less controversial. "We have a good stockpile of weapons, but it doesn't match what we want," President Donald Trump wrote in Truth Social on Monday.

Such demand could play into Palantir's hands, McPeek said. He says global instability and the need for integrated military solutions will bring the company new deals like the U.S. Army contract they signed in July. At that time, 75 separate contract agreements were combined into a single ten-year contract worth up to $10 billion.

In Palantir's most recently reported quarter, revenue from contracts with the U.S. government.

Palantir's revenue from contracts with the U.S. government brought the company $570 million in the fourth quarter, up 66% year over year. In total, Palantir received $1.9 billion from the U.S. government for 2025, up from $1.2 billion a year earlier.

McPeak recalled that last week, Donald Trump barred the government from partnering with AI startup Anthropic because the latter refused to make its Claude models available for possible use in mass surveillance or autonomous weapons development. Trump gave federal agencies six months to reject Anthropic's products. The Pentagon also recognized the company as a "supply chain risk," which not only prohibits military contractors from commercial relationships with the startup, but also complicates its relationships with other government suppliers.

Analyst Rosenblatt believes the transition period will give agencies enough time to switch to one of the models supported by Palantir. The company itself has used Anthropic's Claude in at least one notable Pentagon mission, but McPeak notes that it will be able to seamlessly implement another, such as one from xAI or OpenAI.

According to the analyst, the main application of AI models during the conflict with Iran could be in data analytics, an area in which Claude is not a leader.

Since the beginning of the year, Palantir securities have fallen in price by 17%. Last month the consensus rating of the company on Wall Street changed from neutral to a recommendation to buy.

Currently, 19 out of 31 Wall Street analysts advise increasing their position in Palantir, according to MarketWatch data. A month ago "bullish" recommendations were ten out of 30. Ten analysts suggest holding this stock in the portfolio - against 17 a month earlier. The company has two sell recommendations.

The Wall Street consensus price target of $185.8 is 28% above current quotes.

This article was AI-translated and verified by a human editor