Shares of Palantir Technologies (PLTR 4.24%) continue to prove all the doubters wrong. Despite its seemingly egregious valuation, the stock continues to soar. Earlier this month, the company released its latest earnings numbers, which looked strong yet again.

After another impressive performance, shares of Palantir are once again hitting new highs. Is it finally approaching a peak, or could the stock still go a whole lot higher this year?

Palantir gives investors a reason to remain bullish

A big challenge for tech companies is that as their businesses grow, they are going up against stronger comparable sales numbers from the previous year. That makes it difficult for a business to maintain a high rate of growth. In Palantir's case, however, that hasn't been a problem at all. Its growth rate has been accelerating.

PLTR operating revenue (quarterly YoY growth), data by YCharts; YoY = year over year.

The business was showing signs of slowing down in 2023. But its new Artificial Intelligence Platform (AIP) provides customers with new ways to enhance and improve their decision-making, leading to tremendous growth. CEO Alex Karp says the company has a "deepening position at the center of the AI revolution."

When a business is growing as fast as Palantir, it's easy to see why the AI stock continued to rally. The only problem is that at a forward price-to-earnings multiple (P/E) of around 200 (which is based on analyst expectations) and at 100 times its trailing revenue, it's hard to find a metric that can justify the company's mammoth valuation.

How high do analysts see the stock going?

Analysts who cover a stock set price targets regularly, and investors often look to them to get an idea of how much upside a business may have. After Palantir's latest earnings numbers came out, many analysts upgraded their price targets for the stock. And while there are many who have price targets set at over $100, the consensus analyst target is $69 -- nowhere near the $116 it costs as of this writing.

Between what analysts are projecting for the stock, and its enormous valuation metrics, it's hard to make a case for why it can still go higher. This is an AI stock that defied reasonability for months, and that puts it in dangerous territory as its extremely high valuation makes it ripe for a sell-off should there be a downturn in the markets.

Palantir is a highly speculative buy at these levels

Palantir was a business worth more than Wells Fargo, one of the top banks in the entire country. It's also worth more than McDonald's, Walt Disney, and many more top blue-chip companies. Its valuation doesn't make sense, and if it was a speculative buy before this recent rally, it's even more of one now.

It's a data analytics company that is benefiting from the AI hype in more ways than one -- through greater sales numbers, and through a seemingly unstoppable wave of bullishness. While it has been doing well, investing in it today involves ignoring valuations, ignoring the risk of a potential slowdown in AI spending in the future, and simply hoping to profit from what's known as the greater fool theory.

The stock can very well rise in value from here, and I certainly wouldn't rule it out; the markets aren't always rational, as is clearly the case with Palantir Technologies. But that doesn't mean its current price, much less a higher one, is going to be sustainable over the long run. Investors should buy the stock at their own risk.