Palantir (PLTR) (Enterprise Software) $32.50 to $33 Sell or take profit.
Overpriced and the 8% jump on S&P inclusion is over done and unjustified: sell or take profit.
Enterprise software is a tough market as we’ve seen with the likes of Snowflake, and Palantir is completely overpriced at 25 x sales at 22% growth – that cannot sustain.
The enterprise software sector is seeing macro uncertainty. Palantir is an excellent company and perhaps one of the few that is showing AI monetization. Its commercial segment is growing very fast and has an impressive pipeline, however PLTR trades at incredible valuations that are difficult to support even using aggressive assumptions.
I had recommended and bought the stock in the $16-$17 range and don’t see good returns at these levels for the next three years. Even given a generous P/S ratio of 14 for 2028 sales of $6Bn, we get a market cap of $78Bn, just $10Bn more than the current $68Bn – implying a total gain of just 14% in 4 years. Not worth the risk.