Palantir's Stock Tumbles Amid AI Hype and Valuation Concerns

Palantir's Stock Takes A Hit: Will AIPCon And Defense Deals Be The Comeback Catalyst? - Palantir Technologies (NASDAQ:PLTR)

Find out which stock just plummeted to the bottom of the new Benzinga Rankings. Updated daily -- spot the biggest red flags before it's too late. Palantir Technologies Inc PLTR has been on a wild ride - up 215.99% over the past year, but down 33.51% in just the last month. The stock is now stuck below its key moving averages, flashing strong bearish signals. Can the upcoming AIPCon and a wave of high-profile deals set PLTR up for a turnaround? Is PLTR Stock Facing A Technical Knockout? Chart created using Benzinga Pro PLTR stock, at $78.05, is trading below its five, 20 and 50-day exponential moving averages, signaling continued selling pressure. The eight-day simple moving average (SMA) at $81.98, 20-day SMA at $94.60 and 50-day SMA at $86.96 all suggest the stock is still in bearish territory. However, the 200-day SMA at $51.95 paints a different picture, hinting at longer-term strength. Momentum indicators aren't helping the bulls either. The MACD at a negative 3.95 is firmly bearish, while the RSI at 39.82 signals PLTR stock isn't quite oversold yet. Read Also: Palantir Calls For 'Software-First Approach' As Pentagon Spends Under 1% On Modern Warfare AIPCon & New Deals: Can They Break The Trend? Palantir is gearing up for its sixth AIPCon on March 13, where it will showcase new AI-driven partnerships. Big-name customers like Heineken NV HEINY, Walgreens Boots Alliance Inc WBA and AT&T Inc T are on board, while fresh government contracts, including a $178 million defense deal for mobile battle stations, keep rolling in. On the tech front, Palantir is strengthening its grip in autonomous drones (Ondas Holdings partnership) and space security (Voyager Technologies collaboration). But will these be enough to shift sentiment? Long-Term Bulls Vs. Short-Term Bears Despite its expanding influence, Palantir's stock is stuck in a bearish trend. AIPCon could provide the narrative boost bulls need, but the technicals suggest caution. For now, the stock remains a battleground between long-term believers and short-term skeptics. Will Palantir stock break free from this slump or is the AI hype cooling off? Investors will be watching closely. Read Next: Nasdaq, S&P 500 Hit 6-Month Lows As Recession Fears Grow: What's Driving Markets Monday? Photo: Shutterstock PLTRPalantir Technologies Inc $81.975.02% Stock Score Locked: Want to See it? Benzinga Rankings give you vital metrics on any stock - anytime. Reveal Full Score Edge Rankings Momentum98.75 Growth37.18 Quality- Value3.22 Price Trend Short Medium Long Overview HEINYHeineken NV $43.730.32% TAT&T Inc $25.84-0.65% WBAWalgreens Boots Alliance Inc $11.230.18% Market News and Data brought to you by Benzinga APIs

Artificial Intelligence Juggernaut Palantir Is Down 32%. Is It Time to Buy the Dip in the Stock?

Is the party finally over for the shares of Palantir Technologies (PLTR 2.84%)? It took just over two years for the stock to rise from the $6 per share range to the all-time closing high of $124.62 per share. Still, within less than a month, it has surrendered 32% of its value. Admittedly, most of the run-up occurred over the previous four months, which may add to the uncertainty about its price. Hence, the question for investors is whether the 32% decline is a natural pullback after a rapid increase, or is it just the beginning of a longer-term decline to come. Palantir's changing business Before Palantir launched its IPO in 2020, its AI-driven analysis technology earned credit for helping U.S. intelligence agencies find Osama bin Laden. Also, noting the relatively limited client base on the government side of the business with its Gotham platform, the company created the Foundry platform to bring this technology to commercial customers. However, the platform that has become most game-changing for Palantir is its Artificial Intelligence Platform, better known as AIP. Organizations credited this generative AI platform with delivering massive productivity gains. In its fourth-quarter 2024 earnings call, Palantir cited an insurance organization that applied AIP to automate underwriting workflows. It took what was a two-week process and completed the work in three hours. The company also told the story of a telecom company that used AIP to help decommission aging technology and equipment more rapidly. Effects on the company's numbers Such stories likely helped fuel the aforementioned run-up in its stock price. Nonetheless, investors should question whether the company's financial performance justifies the massive increase. In 2024, revenue of almost $2.9 billion rose 29% compared to 2023. Moreover, revenue rising by 36% yearly in Q4 points to increasing growth rates. Plus, U.S. revenue grew 38% annually in 2024, which could bode especially well for Palantir since the U.S. accounted for about two-thirds of overall revenue. Additionally, net income in 2024 totaled $462 million, up by 120% year over year, which could arguably help it justify a higher valuation. Still, investors may feel increasingly uncomfortable about the stock's valuation. They may overlook the P/E ratio of around 450 since the company only turned profitable on a yearly basis in 2023. However, the forward P/E ratio of approximately 150 makes it likely the stock price is far ahead of company fundamentals. Investors may also struggle to justify a price-to-sales (P/S) ratio of over 70, especially since that valuation comes after the 32% pullback. Furthermore, growth is likely on track to slow, according to the company itself. In 2025, Palantir forecasts revenue of $3.75 billion at the midpoint, which would amount to a 32% increase from 2024 levels. Most investors would objectively perceive that as a rapid growth rate. Nonetheless, investors often punish stocks for slowing growth, which could hurt Palantir's shares in the near term. Is it time to buy the dip in Palantir stock? Given the productivity gains that companies have made using its AIP platform, Palantir's business should continue to grow rapidly for the foreseeable future. Still, the stock price has likely risen far ahead of its current and future growth, which could lead to lower (or possibly negative) returns for the stock's recent investors in the short and medium term. For now, investors should keep the stock on a watchlist. If valuations fall to more reasonable levels, it will may be worth considering, but at these levels, it is more likely to continue falling before fomenting a sustained recovery.

Palantir Stock Is Down 37% From Its Peak: Here's What Could Happen Next | The Motley Fool

At the time of writing, Palantir's (PLTR 8.31%) stock price is down 37% from an all-time high of roughly $125 reached on Feb. 18. This is an alarming turn of events for a Wall Street darling that has benefited from two big hype cycles: generative AI and the election of Donald Trump. Let's dig deeper to find out if this dip is a buying opportunity or a signal to stay far away from an increasingly volatile tech stock. Since hitting public markets through an initial public offering (IPO) in October 2020, Palantir has always enjoyed a bit of a cult following. For years, the CIA-funded start-up made a name for itself by helping government and military clients with big data analytics -- playing a crucial role in the War on Terror when the company helped the U.S. track down Osama Bin Laden in 2011. But even at the start of its public trading, Palantir was more hype than substance. After the IPO boom, shares languished for around four years until the generative artificial intelligence (AI) hype cycle reignited interest in the company. The expectation is that generative AI will allow Palantir to improve its data analytics capabilities -- even offering real-time insights during fast-paced scenarios like battlefields or law enforcement operations. The synergy is undeniable. Large language models (LLMs) need large amounts of data, which Palantir already handles for its clients. General AI will be yet another tool in its tool kit as it helps organizations optimize their operations, detect fraud, and accomplish critical missions. While Palantir has clear synergies with generative AI, that isn't actually translating to booming growth. In full-year 2020 (two years before ChatGPT introduced the world to generative AI), Palantir's revenue grew by 47%. However, by the full year 2024, the growth rate fell to 29%, which indicates that the new tech isn't exactly a game changer. For comparison, an AI winner like Nvidia saw its top-line growth increase from 53% to 114% over the same time frame. Despite not being a major AI winner, Palantir's stock price climbed a whopping 722% over the last five years, slightly outpacing Nvidia's 704%. This dynamic shows how much hype is built into Palantir's valuation. Palantir's bottom-line situation is also disappointing. While the company reports adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) of $379.5 million, this adds back a whopping $281.8 in stock-based compensation, which is company equity given to employees. While this allows Palantir to save cash, it can increase the number of shares outstanding and dilute the holdings of existing shareholders. Trump's election victory has been another source of hype for Palantir (shares rose more than 60% since Nov. 5.). But just like with AI, this presents few fundamental advantages for the company. Trump has been working to reduce U.S. federal spending. Under new Defense Secretary Pete Hegseth, the Pentagon plans to slash its budget by 8% (around $50 billion annually) every year for the next five years. U.S. government clients made up around 42% of Palantir's revenue in 2024. With Uncle Sam set to tighten his belt over the coming years, Palantir could be in hot water. Further challenges come from overseas government clients like the armed forces of Ukraine, which uses Palantir's software for targeting in its war with Russia. Trump is working to wind down this conflict, potentially cutting more of the company's vital revenue stream. With a forward price-to-earnings (P/E) multiple of 135, Palantir's stock price doesn't account for the company's many challenges. Top-line growth is decent but not spectacular, while extreme stock-based compensation expense eats into its bottom line. Meanwhile, the Trump administration is shaping up to be a challenge, not an opportunity. Palantir shares have already fallen 37% from their all-time high, and unfortunately, even more downside looks inevitable.

Why Palantir Technologies Stock Slumped on Tuesday

Palantir Technologies (PLTR -2.20%) fell further on Tuesday, slumping as much as 6.4% and continuing the downward trajectory that began last month. As of 11:35 a.m. ET, the stock was still down 3.9%. The catalyst that sent the artificial intelligence (AI) software and data mining specialist lower was the opinion of a Wall Street analyst. Too far, too fast? Palantir has been on an epic run over the past three years, gaining 575% (as of this writing), but has fallen more than 30% from its peak, as some believe the stock has simply gotten ahead of itself. Among those is Jefferies analyst Brent Thill, who reiterated his underperform (sell) rating while maintaining his price target of $60. This suggests Palantir stock could still fall another 31% compared to Monday's closing price. The analyst attended the company's customer event, AIPCon, last week. Thill noted that he was "impressed" with Palantir's technology and the multiple case studies that illustrated a strong return on investment (ROI). Despite his seemingly bullish takeaway, the analyst suggested that much of potential growth is already baked into the stock price, calling it the "most expensive stock in our coverage." He also highlighted recent insider sales as a concern. I'm a Palantir bull, but the analyst has a point. Even as the stock has entered correction territory -- losing 33% of its value -- it's still selling for 150 times next year's expected earnings. That makes the stock a risky proposition at this valuation. Don't get me wrong: I believe Palantir is a best-in-class provider of cutting-edge AI solutions for business and government. That said, investors buying the stock at this point should steel themselves for a bumpy ride, understanding that Palantir could still have further to fall.

Palantir Sank Today -- Is the Stock a Buy Right Now?

Palantir (PLTR -3.98%) stock got hit with another round of sell-offs in Tuesday's trading. The company's share price closed out the day's trading down 4% and had been off as much as 6.2% earlier in the session. Palantir's valuation pulled back today in conjunction with new bearish coverage from Jeffries. Brent Thill, the investment firm's lead analyst on the stock, published new coverage on Palantir this morning and maintained an underperform rating on the stock and a one-year price target of $60 per share. Based on Tuesday's closing price of $83.89 per share, Thill's target suggests additional downside of 28.5%. While Thill sang the praises of Palantir's Artificial Intelligence Platform (AIP) after a recent conference showcasing the service, the Jeffries analyst raised concerns about the software specialist's valuation profile. Despite Palantir stock having pulled back 33% from its high, the company is still valued at roughly 150 times this year's expected earnings and 52 times expected sales. No matter how you slice it, that's a highly growth-dependent valuation. Is Palantir stock a buy right now? Palantir's heavily forward-looking valuation means the stock is probably not a good fit for investors without high risk tolerance. Some very strong sales and earnings growth is already priced into the stock, and shares could see a big pullback if business expansion comes in lower than anticipated or the macroeconomic backdrop takes a turn for the worse. On the other hand, Palantir looks to have built a clear leadership position in artificial intelligence (AI) software services for both public and private sector customers. The company's existing strengths are already helping it deliver fantastic sales growth and improved margins, and wins early in the AI race could build the foundations for massive success over the long term. So while Palantir is a risky stock, I think it will deliver strong returns for investors who take a buy-and-hold approach at today's prices.

Could Palantir's Stock Plummet Even Further if Elon Musk's DOGE Cuts Spending? | The Motley Fool

Palantir Technologies (PLTR 8.31%) was one of the hottest artificial intelligence (AI) stocks in 2024 but has seen heavy selling pressure alongside its AI peers so far in 2025. While the prevailing fear driving the markets lower right now is centered around the effects of tariffs and a potential trade war, another initiative also affects government spending: the Department of Government Efficiency (DOGE), headed by Elon Musk. This initiative has set out to find wasteful government spending and in particularly audited the number of software licenses available versus the number of users actually using the software. While Palantir's software hasn't popped up in any of these reports yet, it's a company to watch because it derives 40% of its revenue from U.S. government-related sources. So, should investors be worried about the stock with a DOGE cut potentially looming? Palantir makes AI-powered data analytics software that gives decision-makers the most up-to-date information possible at any given time. And its AIP (Artificial Intelligence Platform) allows users to create AI agents that can make decisions on their behalf. The company started off as a provider of software designed specifically for government use. After having success there, it expanded to the commercial side, which opened up a huge opportunity. But the government is still the company's largest and single most important client. In the fourth quarter, revenue rose to $828 million, with $343 million of that coming from the U.S. government. Furthermore, government revenue grew 45% year over year in the quarter, indicating that there is still massive demand for its AI software from that important customer. Considering that DOGE's stated focus is to root out wasteful spending and modernize government infrastructure, Palantir seems like the last place to cut spending. Its AI software is too important to be cut, so I doubt you'll see any weakness from DOGE's efforts. But it may see some pressure in general as President Donald Trump tries to reduce spending. Regardless, I don't think this will greatly affect the company since the AI revolution is ongoing. With the stock down around 40% from its all-time highs, is it worth buying at this price? Although the company looks primed to continue growing rapidly, there are some considerations for investors. Chief among them is valuation: Although the stock sold off heavily, it's still incredibly expensive. A price tag of 67 times sales is unbelievably expensive, and it's hard to justify, even with the company's strong growth. And 140 times forward earnings is also very pricey -- I'm not sure Palantir's growth is fast enough to justify it. If it maintain its 36% revenue hike that it had in the fourth quarter over the next five years (Wall Street analysts expect 32% and 26% growth in 2025 and 2026, respectively) with a profit margin of 30%, it would still look overvalued. If both of those five-year projections came true, it would trade at 14 times sales and 46 times forward earnings. Those are more reasonable prices for Palantir, but they would require the stock price not to move from today's level until five years from now. This indicates that there is around five years of growth already baked into the price. So Palantir investors don't have to fear DOGE, they have to fear the market's already high opinion of the stock. As a result, I'm not interested in Palantir Technologies right now since there are too many other great bargains out there that don't have an unreasonable valuation.

Down More Than 30% From Its 52-Week High, Is Palantir Technologies Stock a Buy? | The Motley Fool

Palantir Technologies (PLTR -3.98%) has been a darling for tech and artificial intelligence (AI) investors over the past year, as it has continually hit new heights despite concerns about its soaring valuation. Lately, however, it has been falling sharply in value, along with the market as a whole. In just the past month, the stock fell more than 25% and it closed on Monday at a price of less than $84-- that's down 33% from its 52-week high of $125.41. Could this recent drop in value be your chance to buy into one of the hottest AI stocks on the markets? Palantir is a data analytics company that helps companies in their decision-making processes. Whether it's aiding governments in counterterrorism activities or giving commercial customers the best available information they need to make decisions, Palantir can stand to benefit from opportunities across many industries. The launch of its AI-powered platform has taken things to a whole new level, as is evident with the rapid acceleration of its growth rate in recent quarters. During the last three months of 2024, the company reported commercial revenue growth of 64% in the U.S., while U.S. government revenue increased by 45%. Palantir has been on a tear, and its impressive growth is a major reason the stock continues to be a hot buy. Even with the recent fall in value, shares of Palantir are up more than 255% over the past 12 months. While there's no denying Palantir has been a phenomenal, fast-growing business over the past few years, investors also can't deny that its valuation is incredibly high. Even with the recent drop in value, the stock is trading at close to a forward price-to-earnings ration of 160, based on analyst expectations. That is a massive premium investors are paying for the stock. And for that to be justifiable, you would need to believe that there is a tremendous amount of growth still on the horizon for the company. But even under those circumstances, you are effectively paying for a ton of future growth, and it could take years for Palantir's bottom line to catch up with where the stock is right now to make it look like a good investment. It leaves virtually no margin of safety for the stock, which is why on any kind of bad news related to AI or even a hint that spending may not grow feverishly, the stock could be vulnerable to a significant correction. And that's why this can be a risky investment to hang on to, even despite the company's promising growth opportunities. There are many high-powered AI stocks you can invest in, which trade at much more reasonable valuations than Palantir. Even AI chipmaker Nvidia doesn't look so egregiously overvalued -- it trades at just 26 times forward earnings. Palantir is doing well and there's plenty of growth potential for the business, but that doesn't mean investors should ignore its valuation. Buying the stock at a huge premium could result in limited returns, or worse -- significant losses, if reality doesn't line up with expectations. While Palantir's stock is certainly cheaper than it was a few weeks ago, it still could fall a whole lot further than where it is now. Investors will likely be better off pursuing growth stocks that are trading at much more reasonable valuations.

Palantir's Playbook: What Comes Next for the AI Giant? | Investing.com UK

On Thursday, March 13th, Palantir Technologies (NASDAQ:PLTR) is scheduled to host the sixth AIPCon, standing for Artificial Intelligence Platform (AIP) Conference. Previously, in early December 2024, the intelligence software company launched its Warp Speed operating system, specifically designed to streamline manufacturing in sync with President Trump's re-industrialization initiative. At that time, Warp Speed included Anduril Industries, L3Harris, Shield AI, and Panasonic Energy of North America (PENA) as first clients. The sixth AIPCon will unveil how other companies are utilizing Palantir's tech, from Red Cat, Saildrone and SNC to Ursa Major. Additionally, Palantir gained new clients. Most notably, Heineken, Walgreens, {{|R1 RCM}}, RaceTrac and Ripcord. Ahead of the AIPCon, PLTR stock is priced at $83.76 per share, having gained 11% value year-to-date after a steep drop in late February from its all-time high of $124.62 per share. The question is, should retail investors jump into PLTR exposure to preempt AIPCon impressions? Under the Arsenal OS platform, Warp Speed gives manufacturers tools to break down complex production processes to boost operational efficiency. Anduril Industries, known for its unmanned aerial systems (UAS), made the case in late November that Warp Speed enhanced their material resource planning by 200x. Dubbed as the "manufacturing OS for American re-industrialization", Warp Speed is flexible enough to attach to existing manufacturing systems. The company leadership can then gain new operational insights by feeding data into Warp Speed's modules. This is all made possible with the operational layer called Ontology, named for the philosophical study of being. By defining semantics into objects and properties, Ontology framework creates a digital mirror of the organization and its physical assets. The digital twin of the company then provides contextual relationships between objects and actions, making it easier to visualize data, reveal patterns, trends, anomalies and ultimately remove manufacturing choke points. Previously, Palantir boasted that its data integration platform Foundry used Ontology to more effectively deploy vaccination efforts during the pandemic narrative. "Foundry, a configuration of the Palantir Platform, is helping to facilitate pandemic management across agencies such as HHS, CDC, FEMA, DOD, NIH, and FDA during the COVID-19 outbreak." It took President Trump's second term to start distancing himself from the pandemic narrative, as he signed an Executive Order (EO) to prohibit federal funding for Covid-19 vaccine mandates in schools. As previously covered in Palantir as a dark horse AI stock, the company is positioning itself as the AI-powered layer of governance, both commercial and nation-state. In the context of the US, this translates to hegemony technology provider, facilitating the analysis of Big Data and centralized data control from disparate sources. Palantir CEO Alex Karp is often seen at high-level meetings with Elon Musk and government officials. Musk's Department of Government Efficiency (DOGE) is aiming to reduce government waste by at least $1 trillion, already having made historic revelations by exposing USAID patronage networks. Karp sees this development as beneficial for the company in the long run. In Q4 2024 earnings call on February 3rd, Palantir CEO noted that "whatever is good for America will be good for Americans and very good for Palantir." He further expressed optimism on the overall direction of the US. "There's a revolution. Some people get their heads cut off. Like -- you know, it's like, we're expecting to see really unexpected things and to win basically. That's what we're going to do. See unexpected things, report expected things, and win. And we're planning to do that, and we're pretty optimistic about the U.S. environment." For the quarter, Palantir's revenue grew year-over-year by 36% to $828 million. Karp sees such impressive growth as a "new phase" for Palantir's business, one that is gaining both commercial and government momentum. With government contract sales growing 45% year-over-year to $1.2 billion annual sales, it is then reasonable to extrapolate that Palantir will keep accruing more commercial clients. After all, with granular AI tools that have already shown efficacy in the real world, large businesses can ill-afford to remain behind. Most recently, Palantir delivered two TITAN systems to the U.S. Army. The Tactical Intelligence Targeting Access Node systems make use of AI to collect and analyze data from various sensors, which is then delivered to the boots on the ground. Palantir won that contract last year, worth $178 million, beating its competitor RTX Corporation. According to Wall Street Journal, the average PLTR price target is $95.28 vs the current price of $83.76 per share. The ceiling target has double the profit potential, at $160, while the low estimate holds at $40 per share. In the scenario of recession as officially announced, it is likely that the stock market will undergo another major price correction. At that time, PLTR shares should be considered as the optimal exposure for long-term play. *** Neither the author, Tim Fries, nor this website, The Tokenist, provide financial advice. Please consult our website policy prior to making financial decisions.