President Trump

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As of the latest official update, the Department of Government Efficiency (DOGE) saved $214 billion through workforce reduction, grant and contract cancellations, and other measures. From the beginning of President Trump’s second term, it became apparent that he has the backing of major tech players. Case in point, Larry Ellison, as executive chairman of Oracle (ORCL), spearheaded the $500 billion Stargate initiative, together with OpenAI and Japanese SoftBank. Curiously, this AI infrastructure project launched a day after President Trump’s inauguration. Concurrently, Trump signed the executive order on his first day in office to launch Elon Musk’s DOGE to start cutting government waste and boost efficiency. At the heart of all these initiatives lies Palantir (PLTR), headed by Alex Karp. During the year, PLTR stock gained 157% value, presently priced at $193.38, which is over its average price target of $189.40. More importantly, the company has an astronomical trailing twelve-month (TTM) price-to-earnings <a href="https://tokenist.com/investing/p-e-ratio/" rel="noopener noreferrer nofollow">(P/E) ratio</a> of 434.26. The question is, how to understand Palantir’s valuation with a P/E that defies <a href="https://tokenist.com/investing/fundamental-analysis-stocks/" rel="noopener noreferrer nofollow">nearly every rule</a> of fundamental analysis?
<h3 id="palantir-the-silent-conductor-of-ai-governance">Palantir: The Silent Conductor of AI Governance</h3>
Palantir stock is inextricably linked to the AI narrative. In recent months, calling AI a bubble has become extremely common, perhaps more so than at any point, about any subject, in the stock market’s history.
Yet, whether AI infrastructure-building is in bubble territory, especially after circular financing started to take hold, is less relevant than the purpose of AI deployment itself. In late 2024, we drew attention to an <a href="https://tokenist.com/nvidia-and-the-ai-bubble-is-it-real/" rel="noopener noreferrer nofollow">unprecedented effort to make AI happen.</a>
Since then, this became increasingly obvious as AI has been pushed through the Stargate project, Trump’s <a href="https://tokenist.com/beyond-oil-how-ppp-is-transforming-saudi-arabia/" rel="noopener noreferrer nofollow">business delegation</a> to Saudi Arabia, and Trump’s executive orders to <a href="https://tokenist.com/nuclear-meets-ai-which-companies-will-reflect-gains-first/" rel="noopener noreferrer nofollow">unleash energy</a> in order to support the AI data center infrastructure.
In all of these and other instances, we explained why this is happening:
<ul>
 <li>Even at this stage of development, including confabulation, AI is good enough to interpret content.</li>
 <li>As such, AI makes it feasible to shift governance from rule-based rigidity to flexible detection of patterns across unstructured content.</li>
 <li>And as AI evaluates intent, meaning and context, a great many governance processes can be automated.</li>
 <li>Through automation of governance processes, a multiplier effect is achieved.</li>
 <li>When multiplier force is achieved, there is less reliance on human allegiances and more on algorithmic control.</li>
</ul>
Ultimately, this would allow a small group to have outsized influence, beyond public-facing governance figureheads, such as politicians, and their respective institutions. However, to facilitate this transition, a key ingredient needs to materialize – data harmonization.
All large language models (LLMs) need clean, consistent input for maximum content interpretation efficiency. We explored this concept in March when covering Palantir’s <a href="https://tokenist.com/palantirs-playbook-what-comes-next-for-the-ai-giant/" rel="noopener noreferrer nofollow">operational framework dubbed Ontology</a>. To summarize, this is Palantir’s secret sauce by which disparate data sources are unified into coherent objects, as well as their relationships, actions and logic.
By the very nature of data harmonization, having multiple companies do this would be detrimental. In a way, that makes Palantir a de facto unifying standard, or as we framed it a <a href="https://tokenist.com/is-palantir-proving-to-be-the-darkhorse-ai-stock/" rel="noopener noreferrer nofollow">hegemony technology</a>.
And as Palantir runs the operating system of a new breed of governance, the company has to interlink with DOGE, Oracle, OpenAI, Amazon (AWS), Google and many other entities. From early on, it was obvious Trump would select Palantir for exclusive conductor of data harmonization, which is exactly what happened by first signing an <a href="https://www.whitehouse.gov/presidential-actions/2025/03/stopping-waste-fraud-and-abuse-by-eliminating-information-silos/" target="_blank" rel="noopener noreferrer nofollow">executive order</a> to break up information silos across all government agencies.
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<h3 id="securing-monopoly-palantir-s-government-and-global-contracts">Securing Monopoly: Palantir’s Government and Global Contracts</h3>
AI requires data harmonization to work at its best. In turn, data harmonization requires a monopoly to work best as well. Additionally, ideological interests have to be aligned for that monopoly to be granted.
Palantir fits both criteria. President Trump has been quite transparent about such alignment of interests. For instance, in his <a href="https://main.knesset.gov.il/EN/activity/Documents/SpeechPdf/trump.pdf" target="_blank" rel="noopener noreferrer nofollow">speech</a> at Knesset in October, Trump was quite explicit about his funding.
<blockquote class="wp-block-quote">
 “Miriam and Sheldon would come into the office. They’d call me. They’d call me. I think they had more trips to the White House than anybody. Look at her sitting there so innocently. She’s got sixty billion in the bank. Sixty billion.”
</blockquote>
Most recently on Tuesday, at the White House Hanukkah reception, President Trump <a href="https://x.com/Antunes1/status/2001108901127713051" target="_blank" rel="noopener noreferrer nofollow">confirmed </a>he is the “first Jewish President.” Consequently, such alignment of interest confers into Palantir massive future growth and dominant market positioning that cannot be broached.
In late July, this already became apparent with the US Army’s <a href="https://www.army.mil/article/287506/u_s_army_awards_enterprise_service_agreement_to_enhance_military_readiness_and_drive_operational_efficiency" target="_blank" rel="noopener noreferrer nofollow">$10 billion contract</a> across 10 years, as continuation of previous contracts. Another dynamic that is in play is Palantir’s hegemony transference potential. Because the US dominates the EU so completely, as evidenced by the EU’s zero response to Nord Stream pipeline bombings, Palantir should intake more contracts overseas.
Most recently, French domestic intelligence agency, DGSI, onboarded Palantir’s proprietary software in addition to integration and support. Likewise, both the UK and Germany integrated Palantir’s tools, from federal and state police in Germany to military AI products in the UK.
Spain’s Ministry of Defense also granted Palantir a 16.5 million euro contract back in 2023. Again, if there is to be cross-border cooperation, or subjugation in the EU’s case, there is no better way to achieve it outside Palantir’s data harmonization tools.
In Q3 2025, Palantir’s government contract revenue grew 52% year-over-year to $486 million. Although impressive, commercial contract revenue greatly exceeded it by growing 121% to $397 million.
Yet, this is unsurprising given the fusion of corporate and political governance via public-private partnerships (PPPs) and the ever-present regulatory leverage over corporations. We explored this concept in the <a href="https://tokenist.com/alphabets-paradox-why-googles-decay-strengthens-its-dominance/" rel="noopener noreferrer nofollow">valuation of Alphabet (GOOGL)</a> as Control-as-a-Service (CaaS).
<h3 id="palantir-trades-like-governance-itself">Palantir Trades Like Governance Itself</h3>
Palantir’s valuation is pricing institutional entrenchment. Although perceived as a tech stock, the company more precisely provides critical governance infrastructure. In the likely future scenario that Palantir’s commercial revenue exceeds its government contract revenue, this would still be the case. That’s because corporations take cues from governments in an increasingly subservient manner.
And once Palantir’s data harmonization and AI action tools are spread out sufficiently, switching costs become more political than commercial. Lastly, it is easy to see that once governance becomes largely algorithmic, Palantir becomes indispensable.
With that said, to justify its current P/E, Palantir would have to sustain double-digit growth for a decade, in addition to expanding margins and facing minimal competitive pressure. In this light, investors should look at stock market corrections for PLTR dips.
Yet under monopoly-utility logic, Palantir may still be in the early stage of its valuation growth.
Disclaimer: The author does not hold or have a position in any securities discussed in the article. All stock prices were quoted at the time of writing.
The post <a rel="noopener noreferrer nofollow" href="https://tokenist.com/will-the-palantir-playbook-work-in-2026/">Will the Palantir Playbook Work in 2026?</a> appeared first on <a rel="noopener noreferrer nofollow" href="https://tokenist.com">Tokenist</a>.

Will the Palantir Playbook Work in 2026?

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