After dominating the artificial intelligence rally in 2025, Palantir now faces growing skepticism from market professionals. The company continues to report robust operational performance and significantly expanded partnerships, yet analysts are suddenly applying the brakes, warning of a dangerously overheated stock price. Is this the beginning of a substantial correction, or does the recent pullback represent a final buying opportunity before the next upward move?
Strong Client Demand Contrasts with Analyst Concerns
Despite the caution from financial experts, Palantir’s real-world business momentum tells a different story. Major clients continue to demonstrate strong confidence in the company’s Artificial Intelligence Platform (AIP). Just last Wednesday, PwC UK announced a major expansion of its strategic alliance with Palantir, supported by a multi-million dollar investment aimed at accelerating AI transformation across both public and private sectors.
The demand for Palantir’s expertise became even more evident through a recent acquisition by consulting giant Accenture. The firm purchased certified Palantir partner RANGR Data specifically to secure access to 40 highly specialized experts working with the Palantir Foundry platform. These developments underscore Palantir’s entrenched position as an essential industry partner, regardless of stock market fluctuations.
Analyst Downgrade Highlights Valuation Fears
The euphoria surrounding the data analytics specialist received a significant blow on Thursday. An AI analyst from TipRanks downgraded the stock from “Buy” to “Hold” and dramatically reduced the price target from $232 to $188. This pessimistic shift stems not from concerns about the company’s technology, but rather from its current stock valuation.
Should investors sell immediately? Or is it worth buying Palantir?
Valuation experts are seeing clear warning signals with a price-to-earnings ratio exceeding 390. Despite strong operational results and healthy cash flows, the share price appears to have raced far ahead of fundamental data. Technical indicators are adding to the unease: an RSI reading of nearly 79 suggests the stock is massively overbought, significantly increasing the risk of near-term setbacks.
Investor Dilemma: Strong Fundamentals Versus Lofty Valuation
Investors now face a challenging situation. The company continues to deliver operationally with impressive growth—most recently reporting 63 percent revenue growth in the third quarter—yet trades at astronomical valuation levels. The stock continues to struggle against the downward trend of recent days, having lost nearly 10 percent of its value in the past week alone and currently trading around €135.
The recent downgrade serves as a clear signal that valuation discipline is returning to focus. The coming weeks will determine whether the company’s strong partnership developments can justify the market’s extreme expectations, or whether further air needs to escape from the current valuation bubble. While Palantir executes effectively and expands rapidly, particularly within its US operations, the tension between business performance and stock price creates a precarious balancing act for shareholders.
Ad
Palantir Stock: Buy or Sell?! New Palantir Analysis from November 21 delivers the answer:
The latest Palantir figures speak for themselves: Urgent action needed for Palantir investors. Is it worth buying or should you sell? Find out what to do now in the current free analysis from November 21.
Palantir: Buy or sell? Read more here...
