Palantir Stock: Buy Now or Wait for the Dip? Smart Money’s Next Move Revealed
Palantir's stock teeters at a critical inflection point—bulls see explosive growth while bears warn of overheated valuations.
Timing the market remains a fool's errand, yet every investor faces the same dilemma: jump in now or wait for a pullback?
The data intelligence giant continues landing government contracts and enterprise deals, but skeptics question whether current prices already bake in future success.
Market sentiment swings on quarterly earnings beats and macroeconomic signals—neither predictable nor rational.
Remember: Wall Street analysts often miss the forest for the trees while retail traders chase momentum like dogs chasing cars.
Ultimately, conviction outweighs timing. Either you believe in Palantir's long-term vision or you don't—no amount of dip-waiting saves a weak thesis.
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Has Palantir's stock finally run into some resistance?
In recent days, Palantir's stock has been showing signs of slowing down. After hitting a new all-time high of $190 on Aug. 12, it has proceeded to trade lower. By Monday, the AI stock WOULD close at just over $174 -- down 8% from its recent high.
According to analysts, the stock may still have more room to fall. The consensus analyst price target for Palantir stock is just $136.61, which would imply a downside of over 20% from its current price.
However, this is a highly speculative stock. It can be hard to determine whether this is the beginning of a larger-scale sell-off, or simply some investors cashing out and taking their profits. After all, Palantir hasn't suddenly become a lot more expensive. It trades at close to 600 times its trailing earnings. A few months ago, the multiple was a little lower, but still at a price-to-earnings multiple of more than 400.
The business is still generating strong growth
One of the reasons investors may be inclined to remain bullish on Palantir is that the data analytics company continues to post strong growth numbers. In its most recent quarter, which ended on June 30, Palantir's quarterly revenue topped $1 billion for the first time, with its top line rising by 48% year over year. That's a significant acceleration from the 39% revenue growth it achieved a period earlier.
The company also boosted its guidance this past quarter by a couple of hundred thousand dollars. It's now expecting at least $4.1 billion in sales for the full year (versus its previous guidance of around $3.9 billion). With Palantir firing on all cylinders, it's easy to see why growth investors have become so enamored with the stock. But that infatuation has also propelled it to a sky-high valuation, which may be difficult to maintain.
Palantir is wildly overpriced
It's worth paying a premium for top-performing stocks, but in Palantir's case, I believe the premium has gone far beyond being reasonable. Billionaire investor Warren Buffett says that "it's far better to buy a wonderful company at a fair price than a fair company at a wonderful price." But in Palantir's case, the price for the stock is arguably not a fair one for the business, and it's certainly not wonderful. I would call it extremely overpriced.
As promising a stock as Palantir may appear to be, that doesn't mean it's a good buy at any price. Not only would I not hold out for a dip in price, I would wait for a full-blown crash before even considering investing in Palantir. It is so incredibly overvalued that to buy the stock today would involve taking on a great deal of risk and relying on speculation to try to guess where it may go next, since its price isn't grounded by any reasonable valuation metrics.
