2 Hot AI Stocks You Should Consider Selling Right Now

Core Viewpoint - The article discusses two AI stocks, Palantir Technologies and BigBear.ai, which may disappoint investors due to their valuations and growth prospects [3][8][13]. Palantir Technologies - Palantir has a current market cap of $363 billion, making it the 24th-largest company globally [4]. - The company experienced a revenue growth of 39% year over year, with significant contributions from U.S. commercial customers, which grew by 71% [5]. - Despite its growth, Palantir's revenue of $3.1 billion results in a price-to-sales (P/S) ratio of 123, the highest for a company of its size in history [6]. - If Palantir maintains its growth rate, projected revenue in five years could reach $16 billion, leading to a price-to-earnings (P/E) ratio of 72.6, indicating overvaluation [7]. - The expectation is that forward returns for Palantir shareholders will be disappointing, suggesting it may be a good time to sell [8]. BigBear.ai - BigBear.ai has a market cap of $2.4 billion and a P/S ratio of 13, appearing less overvalued than Palantir [10]. - The company's revenue growth is only 5% year over year, with a revenue of $35 million, indicating it is struggling to compete with Palantir [11]. - BigBear.ai reported a $21 million operating loss last quarter, highlighting its financial difficulties [11]. - Recent contracts, such as a $13.4 million deal with the Department of Defense, are not substantial enough to significantly impact the company's business [12]. - The article suggests that BigBear.ai is not a suitable investment during the current technology boom due to its slow growth and financial losses, recommending selling the stock [13].