High Hopes, High Risks: Navigating Potential Overvaluation in Today's Market

RaymondReed
08-23

$Palantir Technologies Inc.(PLTR)$ Could it get to $100 in a few years. Anything is possible with the stock market. Will it's valuation make sense at that price. Most likely not unless they grow much much faster every year until then.

The stock at $32 dollars is trading at a multiple of over 90 times forward projected earnings and every other metric that takes it's forecasted growth into account is also at astronomical heights ( 5 year PEG projected is now over 2.0 and price to sales is now over 30).

Bullish on the company longer term but stocks can get to far ahead of their cash flow and earnings and then trouble can set in for investors. Microsoft, amazon, apple, Intel, Cisco, etc etc, all took a decade and a half to get back to their highs (except for cisco) after the ai, I mean dotcom crash of 2000. If we are in a 1996 moment right now then yeah, $100 Palantir in 2028 would make sense to be on par with year 2000 valutions.

You might think I'm being absurd and hopefully I am. But for those who lived through it the last time it's hard to not see the start of the same history repeating itself. Luckily back then my total investment getting cut in more than half was small. Nowadays different story.

Good luck and happy investing!

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