English
Palantir Stock: 85% Growth, Down 20% This Year
Palantir stock just delivered the best quarter in its history — 85% revenue growth, U.S. sales up 104%, the largest guidance raise the company has ever issued. And it's down roughly 20% year-to-date, near a 52-week low and about a third below its high. That gap isn't the market being wrong. At ~90x forward earnings (200x+ trailing), PLTR was already priced for spectacular. The risk now isn't a stumble — it's merely doing great.
The bull headlines are all true, and the stock is still in the red for 2026. If that sounds like a contradiction, it isn't — it's the whole story of Palantir stock right now.
Why is Palantir stock down when the business is booming?
The numbers are not the problem. Q1 (reported May 4) was a blowout: revenue of $1.63B, up 85% year-over-year — the fastest growth in the company's public history — with U.S. revenue up 104% and U.S. commercial up 133%. Management raised full-year guidance to about $7.66B, its biggest hike ever. And yet PLTR trades near $137, down roughly 20% in 2026, close to its 52-week low around $122 and about 34% below its $207.52 high. Best quarter ever; stock in the red. The market isn't disputing the business — it's repricing the price.
Didn't the 34% drop make Palantir cheap?
No — and this is the trap. Even after the pullback, PLTR trades near 90x forward earnings and north of 200x trailing, against a software-industry median in the high teens. A 34% decline off the highs sounds like a sale; in valuation terms it moved the stock from absurd to merely extreme. One fair-value model now pegs PLTR as roughly fairly valued near $133 — meaning the "discount" is largely spent, not that a bargain has appeared.
What's the real risk here?
Not that Palantir fails — that it merely succeeds. At 90x forward earnings, the price already assumes years of sustained, elite hypergrowth. Decelerate from 85% to a still-spectacular 50–60%, and a multiple that high has nowhere to go but down. That's why HSBC trimmed its target to $151 with a Hold, citing rising competition in AI software and pressure on pricing power. Even the bullish targets near $183–193 don't just require continued execution; they require the multiple to expand from an already-stretched base.
What's the non-consensus takeaway?
Be clear: this is an elite business — roughly 84% gross margins, 60% adjusted operating margins, surging free cash flow, and a genuine lead in deploying enterprise AI. The bear case isn't about quality. It's that "great company" and "great stock from here" stop being the same sentence when you're paying 90x forward. PLTR is a wager that AI-platform demand stays vertical long enough to grow into a valuation that already assumes exactly that. A 20% drawdown to near 52-week lows — right after the best quarter in company history — is the market quietly asking whether that number is a price or a prayer.
FAQ
Is Palantir stock up or down in 2026? Down — roughly 20% year-to-date, trading near its 52-week low despite strong earnings.
How expensive is Palantir stock? About 90x forward earnings and over 200x trailing, versus a software-industry median in the high teens.
When does Palantir report next? Q2 2026 results are expected in early August.
Forward look: The August print is the test — sustaining 70%+ growth could re-arm the bulls, while any deceleration meets a multiple with almost no margin for disappointment.
Bonus rebate to help investors grow in the trading world!
