2 Popular Artificial Intelligence (AI) Stocks to Sell Before They Fall 47% and 62%, According to Wall Street Analysts

Core Insights - Palantir Technologies and CoreWeave have seen significant stock price increases of 109% and 175% respectively this year, but analysts predict potential major losses for shareholders in the coming months [1] Palantir Technologies - Palantir develops analytics software for both commercial and government sectors, with core platforms Foundry and Gotham that assist in managing complex data [3] - The company has an artificial intelligence platform called AIP, enabling clients to utilize large language models for analytics workflows and generative AI applications [3] - Palantir's software architecture is ontology-based, linking digital information to real-world assets to enhance decision-making and create a feedback loop for deeper insights [4] - Morningstar analyst Mark Giarelli anticipates Palantir's addressable market could reach $1.4 trillion by 2033 [5] - Jefferies analyst Brent Thill set a target price of $60 per share for Palantir, indicating a 62% downside from its current price of $158 [6] - Palantir's current valuation at 126 times sales makes it the most expensive stock in the S&P 500, with the next highest at 31 times sales [8] - Analysts believe Palantir's data analytics tools could become foundational like Salesforce's CRM software, but the current valuation poses significant downside risk [9] CoreWeave - CoreWeave specializes in cloud infrastructure and software services, particularly a GPU cloud designed for AI and demanding workloads [10] - The company reported a remarkable 420% revenue increase to $981 million and a 550% rise in adjusted operating income to $162 million, despite a non-GAAP net loss of $150 million due to high interest payments on $8.7 billion in debt [11] - Morgan Stanley analyst Keith Weiss noted CoreWeave's strong financial performance and major client acquisitions, projecting a $360 billion market by 2028, but raised concerns about increased cash burn from AI infrastructure spending [12] - CoreWeave's IPO occurred in March, leading to limited historical data and making stock valuation challenging, with target prices ranging from $32 to $185 per share [13] - The stock trades at 21 times sales, which is high, but expected annual sales growth of 129% through 2026 makes this multiple more acceptable [14]