The People Who Know Nvidia and Palantir Best Have Issued a $9.3 Billion Warning to Wall Street

Core Insights - Nvidia is aggressively pursuing the introduction of a new AI-advanced chip annually, which could solidify its leadership in AI-accelerated data centers [1] - Nvidia's GPUs dominate the AI-accelerated data center market, outperforming competitors with three generations of AI-GPUs [2] - Both Nvidia and Palantir have shown significant growth in 2023, with Nvidia's market cap rising to $5 trillion from $360 billion and Palantir's stock surging nearly 2,900% [5][6] Company Performance - Nvidia's CUDA platform is crucial for developers building large language models, enhancing customer retention within its ecosystem [7] - Palantir's success is attributed to its unique AI-driven software-as-a-service platforms, particularly the Gotham platform, which is used by the U.S. government for military operations [8][9] - Palantir's Foundry segment is rapidly growing, helping businesses optimize their operations [10] Insider Activity - Insiders at Nvidia and Palantir have sold approximately $9.3 billion worth of their own stock since November 4, 2023, raising concerns about the companies' future [14] - There has been minimal insider buying activity, with no purchases of Nvidia stock since December 2020 and only one purchase for Palantir totaling $1.16 million since its IPO [16] - The price-to-sales ratios for both companies are historically high, with Nvidia exceeding 30 and Palantir surpassing 152, indicating potential overvaluation [17][18]