More broadly, Wall Street is thinking along the same lines. Palantir's median target price of $96 per share implies 18% downside, and Amazon's median target price of $270 per share implies 17% upside. Here's what investors should know about these AI stocks.

Wall Street has continuously underestimated it, but Palantir stands to benefit significantly from an increase in

Palantir stock is trading at a lofty valuation "which history suggests is nearly impossible to grow into," Deutsche Bank's Brad Zelnick said.

For the better part of the last two-plus years, the bulls have been in control on Wall Street. The mature stock-fueled Dow Jones Industrial Average, broad-based S&P 500, and growth-focused Nasdaq Composite have all reached numerous record-closing highs.

Palantir's Q4 earnings exceeded expectations, showing strong customer growth and operational efficiency. Read why I'm maintaining a Hold rating for PLTR stock.