PLTR Almost Return To Its Peak ! Buy ?

For week ending 19 Dec 2025, US market had been interesting.

It had a mixed performance but laced with bullish momentum.

On Wed, 17 Dec 2025, both S&P 500 and Nasdaq were still below their 50-day lines as ORCL continued to weigh on AI stocks.

Before the week was over, they managed to reclaim their 50-day & 21-day lines as MU earnings and tame CPI inflation, buoyed markets.

This resulted in leading stocks faring well, with many flashing buy signals, notably sectors in the tech, medical, aerospace and travel.

One of the tech stocks termed a “Buy” by Wall Street analysts is $Palantir Technologies Inc.(PLTR)$, which has an interesting run in 2025, looking back.

PLTR Retrospect.

Historically, PLTR has had a phenomenal run in the last 1½ year.

• It has risen nearly +600% from a breakout in July 2024.

• For 2025, it's up more than +150% to $193.38 (as of 19 Dec 2025).

• Seemingly, it may be difficult for PLTR to make another major advance.

The stock, which traded at a low of $5.92 3 years ago, has soared on optimism about AI data demand.

In addition, PLTR's work with US government and outlook for additional contracts have boosted the software company, with booming earnings and several quarters of accelerating revenue growth.

However, it sank -16% in November 2025 (alone) as PLTR got caught up in a broad tech sell-off amid doubts about the AI supercycle, courtesy of Burry’s short sell.

The Peak, Then Fall.

On Mon, 03 Nov2025, PLTR hit its 2025 intraday all-time high of $207.52 .

This peak was the culmination of a massive rally driven by AI-platform adoption and high expectations leading into PLTR’s Q3 2025 earnings report.

Burry’s "Big Short" Reveal:

Interestingly, while PLTR basked in all its glory, something quite the opposite was happening simultaneously.

On 03 Nov 2025, Michael Burry’s Scion Asset Management filed its Q3 13F (same day as PLTR peaked).  

The filing revealed a massive bearish position — “Put” options on 5 million PLTR shares.

While the 13F report data is from the end of September, the public "reveal" and media frenzy surrounding Burry’s bet against the "AI bubble" hit the news cycles on 04 Nov 2025.

The Coincidence

PLTR literally "topped out" the moment the world learned Burry was betting against it.

Below is a recount of the events surrounding PLTR.

• 03 Nov : PLTR hits record high of $207.18 - $207.52.  

• 04 Nov : News of Burry's short position broke; PLTR drops over -7% on that fateful day, falling back toward the $190s.

Following the "reveal" and a subsequent earnings reaction, PLTR entered a volatile period, dropping as low as $162 later in November 2025, proving that Burry’s reveal coincided almost perfectly with the local "blow-off top."

Now !

Just 1½ months into the debacle, PLTR is (in my humble opinion) quietly made its way back to its peak, well almost !

It has just broken out of traditional bases.

This new opportunity came about after Nasdaq climbed back above the 50-day moving average on Fri, 19 Dec 2025, a hopeful (?) sign for US market that's been wavering.

PLTR’s Break Out

• On Fri, 19 Dec 2025, PLTR broke out above the $190.39 buy point of a cup-with-handle base. (see above, green outline)

• The Buy range goes to $199.90 per share.

• Volume was mildly above average.

• The latest base is a late-stage pattern — meaning PLTR might have a higher chance of failing.

• The previous base (August to early October) also was late-stage, and PLTR rolled over after rising +11.7% from the entry.

What I Like About PLTR ?

(1) Stable ATR.

Palantir has the highest rating in the enterprise software industry group, a group with more than 120 companies, that's noteworthy.

Palantir stock has a 21-day “average” true range (ATR) of 4.51%.

ATR gauges the characteristic breadth of a stock's behavior:

• Stocks with high ATR tend to make large price moves that can trigger sell rules.

• Stocks with lower ATRs tend to make more incremental moves.

(2) Business Model from Evolution to Growth.

PLTR's software specializes in artificial intelligence (AI)-powered data analytics.

Originally, its was developed for government use only, and allegedly helped track down the final hiding location of Osama Bin Laden.

It has also been used for countless other activities, such as Covid-19 vaccine distribution logistics.

Use cases for PLTR's software are nearly endless, as almost every activity has some form of data analytics involved in it.

This reality coupled with its products’ flexibility, enabled PLTR’s successful expansion into the Commercial realm, a critical point that analysts frequently harped on during PLTR’s early days.

The wonderful reality is PLTR’s products have seen widespread adoption in the commercial sector.

Companies ranging from $American Airlines(AAL)$ to $BP PLC(BP)$ have adopted PLTR's software and experienced massive payoffs from integrating the platform into their workflows.

For now, number of US commercial clients remains fairly slim, totaling about 530.

Optimistically, it means there is plenty of room for expansion, that is a key reason why investors are interested in the stock.

Palantir's growth rates are robust, with:

• Commercial revenue rising +73% YoY to $548 million.

• Government revenue increasing +55% YoY to $633 million.

PLTR’s growth rates are significant.

Their consistent QoQ acceleration underscores PLTR’s ability to effectively capitalize on current market tailwinds.

The AI arms race has several faces, and (for now) PLTR is at the top of the AI application software world.

YTD Gains.

• On 02 Jan 2025, PLTR closed at $75.19 per share.

• By 19 Dec 2025, it closed at $193.38 per share.

• That translates to a gain of +157.19% in 2025 (so far), comfortably surpassing the S&P 500’s return of about +15% over the same period.

The gains have firmly pushed PLTR’s market cap above $400 billion, making it the 19th-largest corporation in the S&P 500 index.

It has not been a smooth ride though. PLTR encountered a significant drop from mid-February to early April 2025 and again in early November 2025.

The stock has recovered and then some, reflecting how quickly fortunes can change for a growth stock like PLTR.

Shareholders deserve credit for weathering periods of volatility and recognizing PLTR as a high-quality, long-term holding.

P/E & P/S - Bad News.

PLTR's 2025 YTD - P/E and P/S ratio

As of Fri, 19 Dec 2025, PLTR was trading at a price-to-earnings (P/E) ratio of 460.43, and even its 1-year forward P/E ratio was 184. (see above)

Those are extremely lofty premiums.

Similarly, PLTR’s price-to-sales (P/S) ratio - sitting at 116.74 (as of 19 Dec 2025), also signals that PLTR is extremely overvalued; relative to historical norms and industry peers. (see above)

It is therefore, a bearish indicator from a fundamental valuation perspective.

Peer Comparison.

Palantir currently trades at a significant premium to its industry group.

However, its unique business model and product architecture make a direct, apples-to-apples comparison difficult. (see below)

• The closest and most ‘relevant’ comparison is with $C3.ai, Inc.(AI)$ (competitor).

• Their valuations are miles apart.

Santa Rally.

In the latest poll, analysts identified PLTR as one of 12 actionable stocks for the '12 Days of Christmas' period. Wow !

Importantly, does the inclusion imply a Santa Rally is just around the corner for PLTR ? I hope so…

Palantir Cont’d To Grow in 2026?

As we inch toward 31 Dec 2025, I wonder if PLTR’s exponential growth will carry over into 2026?

The question on many minds is whether the AI boom is still in its early stages. Any continued AI-investment could create more opportunities for PLTR.

For instance, in Q3 2025, PLTR delivered a +63% YoY revenue growth, that included a massive +121% growth in its US commercial revenue.

It also saw net income of $476 million, resulting in a +40% margin.

Should PLTR continue to elevate its margins while delivering high revenue growth, it could, over time, justify its high valuation.

To Buy or Not To Buy?

In my view, PLTR is not for everyone (budget wise).

Value investors will also scoff at its trailing price-to-earnings (P/E) ratio of 460.43 (as of 19 Dec 2025).

However, AI investors who are “ok” with taking some risk and have a long-term time horizon may be better suited for PLTR.

It is easy to question PLTR’s valuation, but infinitely more difficult to question its returns over the past 5 years.

What I Might Do Situationally.

Since 18 Dec 2025, US market rally has improved dramatically over the past 2 sessions, with the S&P 500 and Nasdaq back above key levels.

The major indexes are not far from record highs, but it wouldn't take much to see them drop below their 50-day lines at the same time.

The high number of leading stocks flashing “Buy” signals, from a variety of sectors has been encouraging.

Regardless of whether it is PLTR or other stocks, investors could take advantage by adding some exposure, especially if they scaled out earlier in the week.

Besides individual stocks, investors could also consider broad market ETFs or sector plays in Biotech, Chip, Aerospace and Banking.

Trick is to:

• Step back “in” gradually, looking for diverse leadership.

• Step back “out” readily, should market conditions OR an investor’s position falter.

Note: Heading into Christmas week, followed by New Year, trading volume and market-moving news may be light in the coming 2 weeks.

Will you sit out the next 2 weeks OR seize the Santa Rally if it presents itself and make a last dash before 2025 is over?

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• Do you think PLTR will reclaim its peak price of $207.52 before 2025 is out ’?

• Do you think PLTR will scale even higher than $207.52 in 2026 ?

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