‘Much Too Much’—Top Investor Slams Palantir Stock as Overhyped

Palantir’s stock gets a brutal reality check from a heavyweight investor. Is the data giant’s valuation built on smoke and mirrors?

### The Bear Case Hits Hard

A Wall Street whale just dumped icy water on Palantir’s rally—calling the stock ‘egregiously overpriced’ after its AI hype surge. The critique lands as retail traders pile in, chasing last quarter’s 45% gain.

### Numbers Don’t Lie (But Narratives Do)

Forward P/E still hovering at 75x? Check. Revenue growth slowing to 18%? Check. The math screams ‘bubble’—but since when did that stop a good meme-stock run?

### Cynical Finance Bonus

‘But their government contracts!’ yell the bulls. Cool story—now show us the EBITDA. Spoiler: It’s thinner than a crypto influencer’s trading track record.

Confident Investing Starts Here:

• Easily unpack a company's performance with TipRanks' new KPI Data for smart investment decisions
• Receive undervalued, market resilient stocks right to your inbox with TipRanks' Smart Value Newsletter

The company has clearly struck Gold with its enterprise AI platforms, and has succeeded in both attracting customers and upselling them. Palantir’s most recent earnings report was full of additional evidence that the company remains “dressed for success” – just last week PLTR hit a new record high.

One top investor known by the pseudonym The Value Portfolio has been onboard the PLTR express for years. That being said, the 5-star investor believes the enthusiasm has gone too far, and the time has come to say farewell to this AI winner.

“The company has great assets in a high-demand industry, but its valuation has already priced in a substantial portion of the upside,” explains the investor, who is among the top 2% of all TipRanks’ stock pros.

The Value Portfolio has a hard time looking beyond Palantir’s price-to-earnings multiple of more than 200x and its price-to-sales multiple north of 100x – valuations that the investor believes have already priced in years of impressive growth. Though The Value Porfolio predicts that Palantir will hit these levels, this does not exactly leave much room for gains.

“Palantir is a great company, there’s a reason why we made it our top tech pick of the 2020s. Despite that, any great investment is partially a great investment because of its current valuation,” adds The Value Portfolio.

And that’s just the rub, notes The Value Portfolio, who argues that it is important to understand when investments have outgrown their value. The investor is pretty certain that’s the case with PLTR.

“We now view the company as overvalued,” concludes The Value Portfolio. “We recommend that investors either hold or sell a portion of their investment, and wait for a potential downturn before investing again.”

No surprise here, The Value Portfolio is assigning PLTR a Sell rating. To watch The Value Portfolio’s track record, click here)

While not quite as bearish, there seems to be some weariness among Wall Street regarding Palantir as well. With 3 Buy, 10 Hold, and 4 Sell ratings, PLTR is a consensus Hold (i.e. Neutral) rating. Its 12-month average price target of $104.27 has a downside of some ~28%. (See)

To find good ideas for stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a tool that unites all of TipRanks’ equity insights.