Palantir (PLTR) shares took a substantial hit on Tuesday, plunging over 9% to fall just shy of $158. This tumble marks the fifth consecutive day of decline, raising concerns about possible overvaluation. Despite this sudden dip, Palantir's shares have more than doubled in value in 2025, positioning Palantir as the top-performing stock in the S&P 500 this year. The drastic increase was propelled by soaring demand for the data analytics software company's Artificial Intelligence platform.
Renowned bearish investor, Andrew Left of Citron Research, added fuel to the growing apprehension. In a recent Fox Business interview and subsequent report, Left expressed his skepticism about Palantir's high valuation. He stated his belief that the stock has lost touch with reality and contended that it would be worth closer to $40. This valuation was based on comparisons with OpenAI's price-to-revenue multiple, factoring in Bloomberg consensus forecasts.
Left, famously known as "The Bounty Hunter of Wall Street" for his incisive comments and self-professed knack for spotting overvalued stocks and exposing fraud, is a contentious figure currently facing securities fraud charges. His criticism of Palantir isn't singular. Among eight Wall Street analysts polled by Visible Alpha, just two recommended buying the stock, with six suggesting to hold, arguing that the stock had accelerated too swiftly and might be due for a pullback.
Jefferies analysts, despite appreciating Palantir's robust revenue growth, cautioned that the stock's valuation might be disconnected from even optimistic growth scenarios. Similarly, HSBC analysts labeled the stock as potentially overpriced, warning that it could struggle to match investors' sky-high expectations. The recent fluctuations in share price have forced a review of this story to include the latest values.