Better AI Stock: SpaceX or Palantir? Answer: SpaceX

The article frames the SpaceX-versus-Palantir question around two different AI businesses rather than head-to-head rivals. Palantir sells a ready-to-deploy data analytics platform built for government and commercial use, while xAI provides large language models that others can build applications around. That distinction matters because the two companies are chasing different parts of the AI market, and the article argues xAI's building-block approach will find wider adoption over time.

The growth numbers support the case. xAI's revenue grew 213% year over year last quarter, far outpacing SpaceX's overall 92% and Palantir's 93%. But the article also notes SpaceX trades at about 44 times this year's sales estimates, cheaper than Palantir's 55 times, even as both sit far above the 20-times level typically considered expensive. That combination of faster growth and a lower entry price is why the author sides with SpaceX.

The stakes hinge on whether xAI's faster growth materializes as projected. Wall Street expects SpaceX's overall revenue to grow 153% next year, with xAI leading the way, against 50% for Palantir. The article itself cautions that Palantir's projection has been downgraded repeatedly and that both stocks carry valuation risk, so investors weighing the two are effectively betting on whether the growth gap holds.