Mizuho Tells Investors to Unload Palantir (PLTR) Stock, Citing Valuation
Palantir's (PLTR) "high multiple" is "very difficult to justify," Gregg Moskowitz, an analyst at Japanese bank Mizuho, wrote recently.
The analyst believes that investors should sell PLTR. He placed an $89 price target on the shares.
PLTR Stock Bakes in a Great Deal of Success, Mizuho Says
The huge valuation of the shares already anticipates a "material acceleration" of the company's revenue growth, according to Mizuho. The stock is also baking in financial results that exceed analysts' average estimates, Moskowitz contended.
PLTR is changing hands for 173 times analysts' average 2025 earnings per share estimate.
The Positive Aspects of PLTR
Palantir is likely to beat analysts' average top-line estimates, and the name definitely does deserve "a premium valuation," according to Moskowitz.
What's more, AI adoption in America is likely to be "strong," the analyst believes. Since Palantir is helping companies implement AI, it will probably benefit from the latter trend.
The Recent Price Action of PLTR Stock
In the last month, the shares have fallen 2%, but they are up 29% in the last three months, and they have soared 335% in the last 12 months.
While we acknowledge the potential of PLTR, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than PLTR but that trades at less than 5 times its earnings, check out our report about this .
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires
Disclosure: None. This article is originally published at Insider Monkey.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Miami Herald
29 minutes ago
- Miami Herald
Veteran fund manager reboots Palantir stock price target
There's been a lot of debate surrounding artificial intelligence stocks this year. A boom in AI spending, particularly by hyperscalers ramping infrastructure to meet surging research and development of chatbots and agentic AI, led to eye-popping returns for companies like Palantir Technologies, which markets data analytics platforms. However, concern that spending could decelerate has picked up in 2025 because of worry over a tariffs-driven recession, causing many AI stocks like chip-maker Nvidia to stumble. Related: Legendary fund manager sends blunt 6-word message on bitcoin While the eventual impact of tariffs on recession remains a question mark, there's been little to suggest demand for Palantir's services is slipping. Solid first-quarter earnings results and optimism that trade deals could make tariffs manageable have helped Palantir shares rally 63% this year after a 340% surge in 2024. Palantir's resiliency isn't lost on long-time money manager Chris Versace. Versace, who first picked up shares last year, recently updated his price target as Palantir's stock challenges all-time highs. Bloomberg/Getty Images Investors' interest in Palantir stock swelled after OpenAI's ChatGPT became the fastest app to reach one million users when it was launched in December 2022. ChatGPT's success has spawned the development of rival large language models, including Google's Gemini, and a wave of interest in agentic AI programs that can augment, and in some cases, replace traditional workers. Related: Palantir's stock price surges on AI news, gamma squeeze The activity is widespread across most industries. Banks are using AI to hedge risks, evaluate loans, and price products. Drugmakers are researching AI's ability to predict drug targets and improve clinical trial outcomes. Manufacturers are using it to boost production and quality. Retailers are using it to forecast demand, manage inventories, and curb theft. The U.S. military is even seeing if AI can be effective on the battlefield. The seemingly boundless use cases-and the ability to profit from them-have many companies and governments turning to Palantir's deep expertise in managing and protecting data to train and run new AI apps. Palantir got its start helping the U.S. government build counterterrorism systems. Its Gotham platform still assists governments in those efforts today. It also markets its Foundry platform to manage, interpret, and report data to large companies across enterprise and cloud networks. And its AI platform (AIP) is sold as a tool for developing AI chatbots and apps. Demand for that platform has been big. In the fourth quarter, Palantir closed a "record-setting number of deals," according to CEO Alex Karp. The momentum continued into the first quarter. Revenue rose 39% year-over year to $884 million. Meanwhile, Palantir's profit has continued to improve as sales have grown. In Q1, its net income was $214 million, translating into adjusted earnings per share of 13 cents. "Our revenue soared 55% year-over-year, while our U.S. commercial revenue expanded 71% year-over-year in the first quarter to surpass a one-billion-dollar annual run rate," said Karp in Palantir's first-quarter earnings release. "We are delivering the operating system for the modern enterprise in the era of AI." AI's rapid rise has opened Palantir's products to an increasingly new range of industries, allowing it to diversify its customer base. For example, Bolt Financial, an online checkout platform, recently partnered with Palantir to use AI tools to analyze customer behavior better. More Palantir Palantir gets great news from the PentagonWall Street veteran doubles down on PalantirPalantir bull sends message after CEO joins Trump for Saudi visit The potential to ink more deals like this has caught portfolio manager Chris Versace's attention. "The result [of the Bolt deal] will be technology that can offer shoppers a customized checkout experience, embedded within retailers' sites and apps, and it is one that will extend to agentic checkout as well," wrote Versace on TheStreet Pro. "We see this as the latest expansion by Palantir into the commercial space, and we are likely to see more of this as AI flows through payment processing and digital shopping applications." Alongside Palantir's deeply embedded government contracts, growing relationships with enterprises should provide Palantir with cross-selling opportunities, further driving sales and profit growth, allowing for increased financial guidance. Palantir is guiding for full-year sales growth of 36%, and U.S. commercial revenue growth of 68%. The chances for Palantir growth to continue accelerating has Versace increasingly optimistic about its shares. As a result, he's increased his price target to $140 per share from $130. Related: Veteran fund manager revamps stock market forecast The Arena Media Brands, LLC THESTREET is a registered trademark of TheStreet, Inc.
Yahoo
36 minutes ago
- Yahoo
Japanese Lunar Lander Crashes In Second Failed Mission
A private Japanese lunar lander crashed during an attempted touchdown on the moon Friday. This marks the second failed mission for the Tokyo-based global lunar exploration company, ispace. The lander, named Resilience, lost communication less than two minutes before its scheduled landing in Mare Frigoris, a flat, crater-filled region on the moon's northern near side. A preliminary analysis indicated the laser system for measuring altitude malfunctioned, causing the lander to descend too fast. 'Based on these circumstances, it is currently assumed that the lander likely performed a hard landing on the lunar surface,' ispace said in a statement. 'This is the second time that we were not able to land. So we really have to take it very seriously,' CEO and founder Takeshi Hakamada told reporters, per Associated Press. He apologized to contributors and added that the mission was 'merely a stepping stone' to a larger lander planned for 2027 with NASA involvement. 'Engineers did everything they possibly could' to ensure success, he said minutes before the attempted landing. The 7.5-foot Resilience, launched in January from Florida on a SpaceX rocket, carried an 11-pound, four-wheeled rover named Tenacious, built by ispace's Luxembourg subsidiary. The rover, equipped with a high-definition camera and a shovel for NASA to collect lunar soil, was designed to operate for two weeks during the moon's daylight period. It also carried a toy-size Swedish-style red cottage, dubbed Moonhouse by artist Mikael Genberg, for placement on the lunar surface. The mission's $16 million payload included scientific instruments from Japanese firms and a Taiwanese university. The failure follows ispace's first lunar crash in 2023, caused by inaccurate altitude readings. 'Truly diverse scenarios were possible, including issues with the propulsion system, software or hardware, especially with sensors,' Chief Technology Officer Ryo Ujiie said at a press conference. Jeremy Fix, chief engineer for ispace's U.S. subsidiary, noted last month that the company, with a mission cost less than the first's $100 million, lacks 'infinite funds' and cannot afford repeated failures. 'We're not facing any immediate financial deterioration or distress because of the event,' CFO Jumpei Nozaki said, citing investor support. However, space shares faced heavy sell orders and were poised for a 29% drop. As of Thursday, their market capitalization was over 110 billion yen ($766 million). The crash marks another setback in the commercial lunar race, which began in 2019. U.S. firms Firefly Aerospace and Intuitive Machines achieved successful landings in March, though Intuitive's lander toppled in a crater. Japan's space agency, JAXA, landed its SLIM probe last year, joining Russia, the U.S., China, and India as the only nations with successful robotic lunar landings. 'Expectations for ispace have not faded,' Japanese Prime Minister Shigeru Ishiba posted on X, reported Reuters. Ispace remains committed to NASA's Artemis program, with plans for a third mission in 2027. 'NASA increasingly needs private companies to improve cost efficiency for key missions with limited budgets,' Hakamada said, referencing proposed U.S. budget cuts. Two U.S. companies, Blue Origin and Astrobotic Technology, aim for moon landings by year's end following Astrobotic's 2024 failure.
Yahoo
4 hours ago
- Yahoo
Better Buy: Palantir Stock vs. UnitedHealth Group Stock
Excitement around Palantir seems to rise by the day thanks to the company's ongoing artificial intelligence (AI) tailwinds. UnitedHealth Group has experienced a flurry of operational challenges this year, and investors have punished the stock. While Palantir's momentum looks tempting and UnitedHealth's scandals may spook investors away, valuation trends between these two stocks show a compelling case as to which is the better buy right now. 10 stocks we like better than Palantir Technologies › Two stocks that have been at the center of financial news stories throughout the year are data mining specialist Palantir Technologies (NASDAQ: PLTR) and health insurance giant UnitedHealth Group (NYSE: UNH). The reasons these two companies are fetching so much attention, however, couldn't be more opposite. Palantir has emerged as a darling of the artificial intelligence (AI) revolution. As of this writing (June 5), shares of the stock have gained nearly 60% on the year -- making it one of the top performers in the S&P 500 and Nasdaq-100 indexes. By contrast, UnitedHealth Group stock is the worst-performing name in the Dow Jones Industrial Average -- with shares plummeting by more than 40%. Is now the time to hop on the Palantir train, or should investors take an inventory check on UnitedHealth and choose to buy the dip? It's been just over two years since Palantir released its Artificial Intelligence Platform (AIP), a software suite that's proven to be a transformative game changer in the company's pursuit of competing with the largest players in the tech landscape. Since releasing AIP, Palantir has unlocked a new wave of revenue acceleration -- thanks in large part to the company's impressive penetration of the private sector. For most of its history, Palantir relied heavily on government contracts from the Department of Defense (DOD). While deals with the U.S. Military and its allies are still an important cornerstone of Palantir's business, AIP has helped the company break ground in a host of other use cases -- financial fraud, supply chain and logistics, aviation, and much more. What might be most impressive about Palantir's transformation over the last two years is how rapidly the company transitioned from a cash-burning operation to one that generates consistent profitability. Not only is Palantir acquiring new business, but it's also monetizing these customers in a profitable way. That's a lucrative combination, indeed. The one idea that's paramount for smart investors to understand is that while Palantir's business is soaring, so is the company's share price. As of this writing, Palantir trades at a price-to-sales (P/S) ratio of 97. Not only is that magnitudes higher than any of its peers in the software realm, but it is historically high compared to what investors witnessed during the dot-com bubble in the late 1990s. I don't think I'm the only one who has noticed the pronounced valuation expansion in Palantir, either. Consider that Cathie Wood's Ark Invest portfolio has been trimming Palantir stock as of late, and billionaire money manager Stanley Druckenmiller completely dumped his firm's stake in the AI stock during the first quarter. UnitedHealth Group's coverage couldn't be any more different than Palantir's. While investors continue to cheer on Palantir's dominance, it seems that only negativity surrounds UnitedHealth at the moment. At the core of the health insurer's problems are some operational hiccups. Mismanagement in forecasting utilization rates in the company's Medicare Advantage business, as well as some unforeseen challenges in the pharmacy benefits management (PBM) segment, caused management to reduce financial guidance for 2025. If this weren't enough to get investors worked up, UnitedHealth also replaced its CEO as the company seeks to right the ship and turn things around by next year. UnitedHealth's downward revision and executive changes were met with a stock sell-off for the ages. Don't believe me? As of this writing, shares of UnitedHealth trade at $296 -- hovering near a five-year low. Despite its near-term headwinds, UnitedHealth stock looks awfully tempting at a forward price-to-earnings (P/E) multiple of just 13. When you consider that insiders have been buying the stock in the aftermath of this epic sell-off, I'm cautiously optimistic that all of the bad news surrounding UnitedHealth is priced in. On the other side of the equation, I think it's becoming increasingly difficult to argue that max upside isn't already priced into Palantir. Sure, I'm bullish on the company's future, but buying the stock near an all-time high doesn't seem like a prudent idea right now. Overall, I'd choose to buy the dip in UnitedHealth as opposed to chasing the momentum fueling Palantir stock at the moment. Before you buy stock in Palantir Technologies, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Palantir Technologies wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $669,517!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $868,615!* Now, it's worth noting Stock Advisor's total average return is 792% — a market-crushing outperformance compared to 173% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of June 2, 2025 Adam Spatacco has positions in Palantir Technologies. The Motley Fool has positions in and recommends Palantir Technologies. The Motley Fool recommends UnitedHealth Group. The Motley Fool has a disclosure policy. Better Buy: Palantir Stock vs. UnitedHealth Group Stock was originally published by The Motley Fool Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
