Palantir Stock Rockets 21.2% This Week—Here’s Why Wall Street Is Buzzing
Palantir’s stock just pulled off a gravity-defying leap—soaring 21.2% in a single week. Was it AI hype, government contracts, or just traders chasing momentum? Let’s break it down.
The AI Halo Effect
Another tech firm cashing in on the AI gold rush—because slapping 'machine learning' on a pitch deck still moves markets, apparently.
Big Brother’s Big Budgets
Defense and surveillance deals keep padding Palantir’s bottom line. Who needs privacy when you’ve got quarterly earnings to hit?
Short Squeeze or Sustainable?
Street skeptics whisper ‘overbought’—but since when did fundamentals matter in a market high on Fed liquidity?
One thing’s clear: Palantir’s volatility isn’t for the faint-hearted. Then again, neither is betting on a company that knows *everything* about you.
Palantir brought in $1 billion
It was another massive quarter for the AI darling. Palantir's second-quarter earnings showed adjusted earnings per share (EPS) of $0.16 on $1 billion in sales versus the consensus $0.14 per share on $940 million in sales.
CEO Alex Karp said there is an ongoing "efficient revolution" that will allow him to increase sales while decreasing headcount, saying that his "goal is to get 10x revenue and have 3,600 people. We now have 4,100 [people]."
The company lifted its guidance for the full year from between $3.89 billion and $3.9 billion to between $4.14 billion and $4.15 billion.
Image source: Getty Images
Why Palantir stock's valuation still looks risky
The company's incredible and efficient growth is undeniable, but I continue to have serious doubts about its long-term prospects. Its trailing price-to-earnings ratio (P/E) is more than 600, 10 times that ofand almost 30 times that of. It even dwarfs, which has its own valuation issues.
The company would have to achieve near perfection for many years to justify this sort of multiple. I'm not sure it can, despite the Optimism of its CEO. I would stay away from Palantir stock at this price.
