Investors can earn strong, market-beating returns by investing in stocks that are trending higher. This is known as momentum investing. Adding in a company with growing earnings, a growth momentum play is stronger than a weak company that’s rallying.
Today, growth has been rampant, particularly in some tech sectors as AI systems have rolled out. While skepticism about AI is on the rise, some companies utilizing AI may still have considerable earnings growth ahead.
One such play is Palantir Technologies (PLTR). The big-data analytics company has been a top performer in 2025, handily beating the drop in the Magnificent Seven stocks. While valuation is high, the company’s earnings came in strong.
Plus, Palantir reports an increase in revenues from existing users, indicating more use of the company’s AI-driven software. And company CEO Alex Karp has ended a plan to sell off some of his holdings.
Action to take: With solid earnings and revenue growth, and several other bullish factors at play, shares could shake off their post-earnings selloff and trend higher.
Currently, Palantir does not pay a dividend, but could do so in the years ahead after its growth phase starts to slow down.
For traders, shares likely took a post-earnings hit for only beating expectations by about 1.1%. The July $130 calls, last trading for about $4.90, could see mid-to-high double-digit returns from a partial rebound in shares in the weeks ahead.
Disclosure: The author of this article has a position in the company mentioned here, and may further trade after the next 72 hours. The author receives no compensation from any company mentioned in this article.