Palantir Retail Investors Shun Valuation As Staggeringly High Even As Company’s Deal Momentum Accelerates

Artificial intelligence-powered data analytics company Palantir Technologies, inc. (PLTR) has been experiencing a strong deal momentum.

On Tuesday, consultancy firm Bain & Co announced a partnership with Palantir under which the latter’s AI operating system (OS) will be paired with Bain’s industry expertise across sectors and its strategic business transformation capabilities.

This, in turn, will enable clients to adopt the technology more quickly.

"At Bain, we are helping clients lead in the era of AI — not just with strategy, but with implementation that drives measurable results," said Chuck Whitten, partner and global head of the firm's digital practices and capabilities. 

Sameer Kirtane, Head of Commercial Sales at Palantir, touted the advantage of adopting its AI OS, which helps firms change their unit economics.

“We believe Bain can help our customers accelerate their pace of adoption and, as a result, lead their respective industries.”

Last week, Denver, Colorado-based Palantir secured an incremental $795 million contract for Maven Smart System software licenses from the U.S. Department of Defense (DoD). This followed an initial $480 million award announced in May 2024. Together, the contract is now valued at $1.3 billion. 

On Stocktwits, retail sentiment toward Palantir stock remained ‘bearish’ (26/100), with the message volume at ‘low’ levels. The stock is among the platform's top 15 most active equity tickers by early Tuesday.

Much of the skepticism is premised on the company’s valuation. One watcher said Palantir’s market capitalization has grown 100 times faster than the business itself and that the industry now needed time to grow to justify the valuation.

“The market cap is so disgustingly out of line that the stock price could remain the same for 25 years,” they said.

Another user called for a 12% plunge on Tuesday.

Palantir stock ended Friday’s session up 0.83% at $123.31, with the year-to-date gains at 63%. The stock is now the second-best-performing S&P 500 company this year.

The Koyfin-compiled consensus price target of $96.61 for the Palantir stock suggests nearly 22% downside from current levels.

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