Palantir’s Bubble Bursts: Why PLTR’s 211x (P/E) Multiple Screams ‘Sell Now

Palantir Technologies (NASDAQ: PLTR) is a software company that specializes in big data analytics and artificial intelligence (AI

Palantir shares dived nearly 8% today

Quick overview

  • Palantir Technologies (PLTR) has seen a remarkable growth of 143% year-to-date and 363.11% over the past year.
  • The company's revenue guidance for the full year has been raised to $4.14 to $4.15 billion, exceeding previous expectations.
  • Despite its strong performance, mixed investor opinions exist, with some viewing the stock as overbought and others anticipating further growth.
  • Palantir's high valuation metrics, including a forward P/E ratio of 211, suggest that any missteps could lead to significant declines.

Palantir Technologies ( PLTR)  experienced significant growth, up 143% year-to-date and 363.11% over the past year.

AI Hype Meets Reality: Palantir Struggles After Sharp Pullback

The 52-week trading range is between $39 and $190. PLTR is now recognized alongside Nvidia (NVDA) as a leading AI performer, having risen 147% in 2025. Analysts credit this surge to a 78% increase in earnings and a 48% growth in quarterly revenue.

The company’s full-year revenue guidance has been raised to $4.14 to $4.15 billion, notably above the previous consensus of $3.89 billion.

PLTR’s forward price-to-earnings (P/E) ratio is an exceptionally high 211, significantly above the S&P 500’s 23 and Nvidia’s 41.5.

Opinions among investors are mixed, while some technical indicators suggest potential pullbacks. Some view the stock as overbought, while others believe it is positioned for further AI-driven growth.

Palantir’s high valuation relies on consistent strong performance in a rapidly evolving AI market, and even minor missteps could lead to significant declines.

The enterprise value-to-EBITDA ratio is approximately 150x, and the stock’s forward P/E ratio exceeds 200, far surpassing competitors like Snowflake (SNOW), which trades at about 10x sales, and even Nvidia at its peak.

Palantir reported revenue of $1 billion, representing 48%, with U.S. government revenue up 53% and commercial revenue up 93%.

However, as the company grows, it faces the “law of large numbers,” which may impact its growth trajectory.

Analysts predict that fiscal year 2025 revenue will be around $3.9 billion; however, a miss in Q3 guidance, due in early November, could greatly impact the stock price. Investors may not be satisfied with even a 50% growth rate; if actual results fall short of expectations, the stock could face a severe decline.

ABOUT THE AUTHOR See More
Olumide Adesina
Financial Market Writer
Olumide Adesina is a French-born Nigerian financial writer. He tracks the financial markets with over 15 years of working experience in investment trading.

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