This article first appeared on GuruFocus.

An analyst urged caution on Palantir Technologies (NASDAQ:PLTR) even after another strong quarter. Freedom Capital Markets' Almas Almaganbetov raised his price target to $170 from $125 but kept a "Sell" rating, saying the stock may be priced for perfection.

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Palantir posted $1.18 billion in revenue in the third quarter and an adjusted operating margin of 51%.

U.S. commercial revenue surged 121% year over year, helping drive record bookings for its AIP platform.

Even so, PLTR shares slid about 7% after the report, trimming gains following a year-to-date rally of more than 127%.

Almaganbetov said growth could soften beyond next year as U.S. commercial momentum normalizes, government and defense budgets tighten and hiring for AI talent pushes costs higher.

He warned current valuation leaves little room for disappointment, creating downside risk if growth slows.

The note highlights the tension between rapid AI adoption and stretched expectations, and may prompt investors to reassess exposure to enterprise AI and defense-focused software names.