Shares of Palantir Technologies Inc (NASDAQ:PLTR) continue to face selling pressure following an AI-powered rally in recent months. Here’s a look at what’s going on.
What Happened: Palantir stock hit all-time highs in early August following a strong second-quarter earnings report. The company beat estimates on the top and bottom lines, reporting revenue of $1.004 billion versus estimates of $939.71 million, and adjusted earnings per share of 16 cents versus estimates of 14 cents.
The rally in Palantir shares reversed course earlier this month after Citron's Andrew Left said the stock had become "beyond overvalued." Citron announced a short position against Palantir and argued in a research report that the stock should be trading at $40 per share.
“At $40, PLTR would still be expensive,” Citron said in the report.
Benzinga Edge rankings show moderate fundamentals, with Value ranking 2.76/100, Growth ranking 95.17/100 and Momentum ranking 98.49/100. Overall, the strong Growth and Momentum rankings indicate potential for future performance, despite the low Value ranking.
The stock shows a bearish trend, with resistance at $156.39 and support at $149.37. The recent high of $156.39 failed to hold, indicating a potential reversal as it approaches the support level. Analysts have highlighted Palantir’s valuation edge, noting its 2025 Price/Earnings-to-Growth (PEG) ratio stands at 1.6x, which is favorable compared to Salesforce’s 1.5x, suggesting it may be undervalued despite concerns about high P/E ratios. Palantir trades with a forward P/E of approximately 250, according to Benzinga Pro.
MACD lines are converging, with the MACD at -1.25 and the signal line at -1.30, indicating a potential shift in momentum if the lines cross. This could lead to a bullish divergence if the price holds above support. The market structure shows lower highs and lower lows, confirming a downtrend. The recent price action forms a descending triangle, with the base at $149.37, suggesting a potential breakdown if it fails to hold that level.
PLTR Price Action: Palantir shares were down 1.61% at $156.23 at the time of publication on Monday, according to Benzinga Pro.
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