Palantir: Artificial Intelligence Hue and Cry Is Leading to an Exuberant Valuation for Palantir

Over the past few weeks, narrow-moat Palantir’s shares have skyrocketed to more than $16 per share, up from just under $8 in early May. The rise, catalyzed by strong first-quarter results, has left Palantir trading significantly higher than our $9 fair value estimate. We believe investors should tread with caution as we believe that the dramatic uptick in Palantir’s share price is not currently backed by a similar rising strength in the firm’s fundamentals. While we maintain a positive outlook on Palantir’s business, future growth opportunities, and increasing target addressable market, we believe the firm’s shares are currently overvalued.