By this point in time, even casual investors are exceptionally aware of the immense growth experienced by Palantir Technologies (NASDAQ:PLTR). The company’s share price has exploded by over 2,000% since the beginning of 2024, running wild as the AI revolution took off into the stratosphere.
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Unlike meme stocks or those that are surging on hype alone, PLTR has plenty of fundamentals backing up its growth story. Palantir has been growing sales at a fast clip, and last quarter delivered over $1 billion in revenues for the first time, while attracting plenty of new clientele and upselling existing customers along the way.
The company and its leadership have planted their flag at the forefront of Western values and interests, with massive government security contracts in the U.S. and Europe. While that could be reason enough to get excited, the company has also been expanding in the commercial sector as well – growing U.S. commercial by 93% year-over-year last quarter.
The biggest knock against the company is arguably its premium valuation, which is above and beyond its peers. Perhaps some of these valuation fears are starting to surface, as the company’s share price fell some 15% over the past few days following a new record high that was recorded after the company’s blowout Q2 2025 earning report.
That’s exactly what investor Daniel Jones thinks is taking place.
“I believe that the drop that the stock saw on August 19th is not the last drop that we will have seen. At some point, I expect shares to take quite a tumble,” predicts the 5-star investor.
Jones is quick to point out that Palantir’s impressive growth story is far from over, noting the expanding deal flow and multimillion dollar contracts that the company has been inking – citing the 42 deals that were worth over $10 million in Q2 2025.
However, even assuming revenues grow at 60% annually and operating cash flow margin is 65%, the investor still posits that PLTR would not begin to be reasonable priced until 2028.
“This just does not make sense in any conceivable way,” adds Jones, who reminds investors that eventually the growth rates will be slowing down.
Joens is therefore steering clear of this one.
“Given the excessive premium and likelihood of further declines, I maintain a ‘strong sell’ rating on Palantir despite its impressive growth story,” sums up Jones. (To watch Daniel Jones’ track record, click here)
Wall Street is taking a cautious stance. With 13 Holds overshadowing 4 Buys and 2 Sells, PLTR has a consensus Hold (i.e. Neutral) rating. Its 12-month average price target of $154.47 implies minimal movement in the year ahead. (See PLTR stock forecast)
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Disclaimer: The opinions expressed in this article are solely those of the featured investor. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.