"Shares of Palantir ( NASDAQ:PLTR) have continued to sag in recent weeks despite a promising number of new developments, including a huge deal with South Korea's Hyundai, which is reportedly being pinned as being worth in the ballpark of "hundreds of millions." Undoubtedly, it's another big-league deal in the books and one that could act as a huge win for both companies. Palantir also collaborated with another firm for work on data centers in Europe, the Middle East, and Africa."
"Add a recent upgrade from a big-name bank in Citi into the equation, and it certainly feels like the latest bearish dip is worth getting behind, even though the valuation on shares remains incredibly high. There has been a good amount of deal-making momentum of late. Though, such deals have been less of a needle-mover of late, given the recent surge in volatility surrounding the higher-multiple AI stocks."
"While Michael Burry, who's holding bearish bets against the company, might be cheering the latest move lower, it's difficult to know what to do as the bulls and bears make their cases. At this juncture, the bull and bear cases are both pretty convincing. But, of course, the downside risks could be considerable, given the 169 times forward price-to-earnings (P/E) multiple."
Palantir shares have fallen recently despite securing a large Hyundai deal reportedly worth in the ballpark of "hundreds of millions" and collaborating on data-center work across Europe, the Middle East, and Africa. Citi upgraded the stock to a buy from neutral, adding bullish momentum. Deal-making momentum has increased but has failed to move the needle amid heightened volatility in higher-multiple AI stocks. Quarterly earnings approach with elevated expectations. Michael Burry holds bearish bets against the company. Both bull and bear cases appear convincing while the stock trades at about 169 times forward P/E, increasing downside risk despite a recent more-than-20% dip.
Read at 24/7 Wall St.
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