That said, the valuation is definitely stretched, and I’m cautious about chasing it too aggressively. I’ve trimmed some profits but continue to hold a core position, especially given the long-term potential in both government and commercial AI adoption. Insider selling and potential budget cuts are red flags I’m watching closely.
My outlook remains optimistic but measured. I’ll stay on board unless market sentiment turns sharply or fundamentals shift. Palantir is in a unique position — and while it’s not without risks, I believe its story still has room to play out.
🎁What the Tigers Say | PLTR: To the Moon or Just Riding the Trump Trade?
@TigerClub：
Palantir has been standing out in this recent market downturn. After hitting a new high in February, it dipped just 0.61% in March and has already rebounded 16.59% in April — bringing its year-to-date gain to an impressive 30.11%. While often labeled as an AI play, Palantir is also a defense stock, which tends to shine during times of market volatility and geopolitical tension. This week, shares surged again after NATO announced it would adopt Palantir’s AI software to modernize its defense capabilities. But here’s the catch: valuation concerns still linger. Do you believe in Palantir’s continued rebound, or is this just a temporary hype rally? What’s your price target for PLTR? 🎁Special Notes: Whoever showed up on the” What the Tigers Say” column will receive 100 Tiger Coins and an exclusive interview invitation to honor your contribution. Click titles to read the full analysis: 1. @ToNi: Key Points: 1. Continued Rebound or Sell on Rally? I believe Palantir can continue its rebound in the near term due to the NATO deal and strong government contract growth, but its high valuation warrants caution. Hold for long-term growth, or sell near $98 to lock in gains if you’re risk-averse. 2. Steepest Decline in a Market Plunge? Palantir’s high valuation makes it vulnerable to a significant decline in a market plunge, but its stable contract revenue and defense AI role may limit the damage compared to tariff-exposed stocks. A 30% drop to $60–$70 is possible in a severe downturn. 3. Price Target for Palantir? My price target is $110 over the next 12 months, a 19% upside from $92.32, driven by growth in AI and defense contracts, though market volatility and valuation risks could push it lower if conditions worsen. 2. @yourcelesttyy: Key Points: Do You Believe in Palantir’s Continued Rebound, or Is It Better to Sell on Rally? The NATO deal is a solid tailwind, and if Trump’s administration doubles down on defense tech, Palantir could ride a wave of new contracts. Its customer growth and cash flow strength add credence to the rebound thesis. However, the 4.6% pop might be a peak moment to cash out some gains, given the valuation risks and budget-cut overhang. Verdict: I lean toward a cautious “sell on rally” strategy—take partial profits now but hold a core position if you’re bullish on Palantir’s AI dominance. A stop-loss at 5-10% below current levels could protect against a sudden drop. If the Market Plunges Again, Does Palantir’s High Valuation Mean It Could Face the Steepest Decline? Yes, high-valuation stocks like Palantir are prime candidates for outsized declines in a market crash. Its P/S of 80 and elevated PE leave little margin of safety—sentiment shifts could trigger a sell-off far sharper than the broader market’s. Think of February’s tumble as a preview: when bad news hit, Palantir shed value fast. Verdict: If the S&P 500 dives again, expect Palantir to fall harder—potentially 20-30% versus the index’s 10-15%. 3. @Mettamadhan: Key Points: Overbought. Biggest plunge if the uncertainity continues. 45-55 is the buy zone. 4. @Kinjal : Key Points: PLTR is a good company to buy but PE is very high and RoE is very low. 5. @DaraC: Key Points: It seems the tariff has no effect on this stock. 6. @股勇者 : Key Points: Closed swing trade position on PLTR with 11.5% return in 1 week. 7. @Stayclose: Key Points: PLTR managed to break and hold $90 level which is a very huge level for PLTR. Great to see some strength back at PLTR again. Quick scalp on PLTR again bought at $93.55, sold at $95. Some resistance at $94-$95 level, else watch for $98 for resistance. 8. @Mickey082024: Key Points: Risk #1: Palantir’s Overvalued Stock Price Now, when we look at Palantir’s forward P/E ratio, it’s trading at an astonishing 114x forward earnings. To put this in perspective, the average stock in the S&P 500 trades at roughly 20x earnings. That means Palantir is 5 times more expensive than the typical company in the broader market. Sure, Palantir is an exceptional company with a unique business model and a strong market position, but does that justify such a steep premium? In my opinion, the premium valuation is overdone. Let’s look at the numbers from last year: at the beginning of 2024, Palantir was trading at a much more reasonable forward P/E in the 40s, which I thought represented good value. But now, with a P/E ratio in the 100s, it’s hard to ignore the risk of a correction. If sentiment shifts and investors become less willing to pay such a high price for Palantir, we could see the stock price fall significantly. Even if Palantir’s earnings per share remain stable, a contraction in its valuation multiple could lead to a 50% decline in the stock price, still leaving it more expensive than it has been for most of the past three years. Risk #2: Insider Selling by CEO Alex Karp Now, the situation with Palantir is a bit more complicated because the stock is already highly priced. If Palantir were trading at a more reasonable valuation, insider selling wouldn’t be such a big deal. But when the stock is priced to perfection, any hint of insider selling can be the catalyst for a valuation reset. So while CEO Karp’s sale isn’t necessarily a red flag in isolation, combined with the overvalued stock and the current market conditions, it adds a layer of risk that investors need to keep an eye on. Risk #3: Palantir’s Reliance on Government Contracts The issue with Palantir is that the U.S. government is actively working to cut spending. As the government looks to reduce its budget and focus on cost savings, Palantir, which gets a significant portion of its revenue from government contracts, could see its business impacted negatively. If government spending in areas Palantir serves decreases, the company may struggle to maintain growth. This is especially risky right now, given that the U.S. economy is likely headed into a recession, and government spending cuts are likely to continue. Unlike businesses that can adjust their strategies in response to economic shifts, Palantir’s heavy reliance on government contracts leaves it more exposed to these budget cuts. Questions for you: Do you believe in Palantir’s continued rebound, or is this just a temporary hype rally? What’s your price target for PLTR? 🎁Prizes 🐯 All valid comments on the following post will receive 5 Tiger Coins. We strongly recommend selecting the "Also repost" button when posting a comment to receive more rewards. ⏰Duration 23 April (24pm EDT)
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.
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