Cathie Wood's shares remain off-limits, as their value is excessively high, akin to Elon Musk's stake in Tesla.
In the world of technology stocks, Palantir has been making waves recently, with its share price reaching new heights. However, some members of the DER AKTIONÄR editorial team express divided opinions about the company, as its current valuation appears to be a subject of debate.
As of August 14, 2025, Palantir's stock trades around $182–$184, near its 52-week high of $190 but vastly above its 52-week low of around $29. This surge followed the release of Palantir's latest earnings, which included an upward revision to guidance. Despite this, the company's PE ratio is extremely high at ~600 times trailing earnings and a forward PE of ~243, which is extraordinarily elevated compared to typical software/technology industry averages.
The average analyst rating is "Hold" with a 12-month price target averaging $134.72, implying a downside potential of about -25.58% from current levels. This reflects skepticism about sustaining current valuations, as Palantir's stock price appears significantly overvalued compared to its historical performance and industry peers.
Despite delivering strong revenue growth (28.79% in 2024) and earnings growth (120.27% in 2024), with forecasts for further earnings growth around 31.57% annually, such strong growth is largely priced in at these levels. This means that upside potential is limited unless growth accelerates further.
Relative to industry peers, Palantir's market cap of around $429 billion with revenue under $3.5 billion results in a very high valuation multiple, outpacing most comparable software and data analytics companies, which generally have lower PE ratios and more moderate growth expectations.
The high valuation and volatility of Palantir's stock are further highlighted by its beta of around 2.5, suggesting high risk for investors at current high valuations. This risk is particularly notable given that Cathie Wood of ARK funds has sold Palantir shares in the tens of millions, potentially indicating a bearish outlook.
In summary, while Palantir continues to show robust growth, the current stock price is priced for near-perfect execution and very high growth rates, making it appear overvalued relative to its own history and typical industry metrics. The consensus analyst outlook and valuation multiples suggest caution about further price appreciation unless fundamentals materially improve beyond current expectations. It is a stock that has had an extraordinary rise since its IPO, with an over 1800% increase, but it remains to be seen whether this trend will continue.
Investors might find it prudent to approach Palantir's finance sector, given its high PE ratio and market cap, which are significantly higher than average for software/technology companies. Due to its overvaluation, the stock may not offer substantial investing opportunities, as indicated by analysts' 'Hold' rating and the downside potential of about -25.58%.
