Palantir Technologies Stock Is Down More Than 25% Since Its Peak. Is It Finally Time to Buy the Dip?

Core Viewpoint - Palantir Technologies has experienced significant stock volatility, with a recent decline of approximately 25% after reaching an all-time high, raising questions about potential investment opportunities amidst uncertainty [1][2]. Group 1: Stock Performance - Palantir's stock gained as much as 1,250% over the past two years but has recently plunged by 11.9% in one day, with a current decline of 8.1% [1]. - The stock has lost roughly 25% over the past five days since hitting a new all-time high [2]. Group 2: Executive Actions - CEO Alex Karp plans to sell 9,975,000 shares of stock through a 10b5-1 trading plan, potentially liquidating shares worth up to $1.24 billion [2]. - Karp's stock-based compensation structure makes his decision to sell shares not particularly surprising [2]. Group 3: Market Concerns - Reports indicate that Defense Secretary Pete Hegseth plans to cut defense spending by 8% annually over the next five years, which could impact Palantir's growth as a major supplier to U.S. intelligence and defense agencies [3]. - The lack of consensus on Wall Street regarding Palantir's stock is evident, with ratings ranging from buy to underperform [4]. Group 4: Valuation and Investment Strategy - Despite the recent decline, Palantir's stock is still valued at 167 times next year's expected earnings, indicating it remains overvalued [5]. - Investors are advised to exercise caution due to ongoing volatility, with dollar-cost averaging suggested as a potential investment strategy [5].