Shares of Palantir Technologies climbed on Monday as defence stocks moved higher amid escalating tensions tied to the US-Iran war.
At the time of writing, Palantir stock was up around 6% to trade at $145.
The broader defence sector advanced after Israeli forces and Hezbollah fighters in Lebanon exchanged missile fire, and the US military announced it was sending additional troops to the Middle East.
The prospect of a prolonged conflict lifted traditional defence contractors such as Lockheed Martin and RTX.
Palantir, which provides data analytics tools to government customers for intelligence gathering, surveillance, counterterrorism, and military purposes, benefited from the shift in investor sentiment toward defence-linked names.
The company implements a significant portion of artificial intelligence technology at the Pentagon.
Last year, Palantir secured a $10 billion contract with the US Army that consolidated 75 contracts into a single agreement, in addition to a $448 million deal with the Navy.
The stock’s move mirrors a similar reaction earlier this year, when shares jumped after the US raided Venezuela in January and toppled leader Nicolás Maduro, although that rally proved short-lived.
Dual exposure to defence and AI
Palantir occupies a unique position in the market as both a defence contractor and a beneficiary of the artificial intelligence boom.
In addition to its government-facing operations, the company has been expanding into the US commercial sector, using generative AI to drive growth in industries such as healthcare and financial services.
This dual exposure may provide an advantage over large-cap technology peers during periods of geopolitical instability, as investors seek companies tied to defence spending while maintaining exposure to AI-driven growth.
Rosenblatt initiates coverage with Buy
Last week, Rosenblatt Securities initiated coverage on Palantir with a Buy rating and a $150 price target.
The firm described Palantir as a market-disrupting AI software leader with a distinctive competitive position.
Rosenblatt cited a sustainable growth trajectory and operating leverage as key reasons for its positive outlook.
The analyst highlighted revenue growth of 56% over the past 12 months and a gross profit margin of 82% as indicators of strong fundamentals.
With shares down substantially from their October high, Rosenblatt said the current level represents an attractive entry point.
UBS sees compelling opportunity after pullback
Separately, UBS upgraded Palantir to Buy from Neutral, arguing that the recent pullback from peak levels presents a compelling opportunity.
“We recommend that investors take advantage of this move off the peak for the premier growth story in software and a company that is at the nexus of the two most powerful spending trends – AI and Data,” analysts led by Karl Keirstead wrote in a note last week.
UBS said Palantir trades at roughly 50 times its 2027 free cash flow estimates, a valuation it views as attractive given its projection for 70% revenue growth in 2026 and stable mid-50% margins.
The firm also pointed to continued strong demand signals.
Based on partner and customer checks, UBS said enterprises are accelerating AI adoption, and it did not identify “any material emerging competition.”
As geopolitical tensions and AI-driven spending trends intersect, Palantir’s ability to sustain rapid growth while capitalising on defence demand will likely remain a focal point for investors in the months ahead.
https://invezz.com/news/2026/03/02/palantir-stock-is-up-6-amid-us-iran-conflict-buy-sell-or-hold/
