Should You Buy Palantir Stock on the Dip?

Core Viewpoint - Palantir Technologies experienced a brief post-earnings bounce after reporting strong fourth-quarter results, but the stock has since declined approximately 33% from its 52-week high, trading at a high sales multiple of 74, raising questions about its valuation and growth potential [1]. Group 1: Financial Performance - Palantir's U.S. commercial revenue grew 137% year over year last quarter, reaching $507 million [5]. - Average revenue from its top 20 customers increased by 45% year over year to $94 million per customer [6]. Group 2: Competitive Position - Palantir is differentiating itself in the competitive AI market by delivering tangible results to customers through advanced AI models [4]. - The number of custom applications being built on Palantir's platform is increasing, with customers generating over 1 billion requests per week via its API, enhancing the platform's stickiness and value [7]. Group 3: Valuation Concerns - The stock's price-to-sales ratio peaked at 137 last year and currently stands at 75, indicating a high valuation that poses a near-term risk for investors [8]. - Analysts project Palantir's revenue to grow at a compound annual rate of 47% through 2028, but investors should anticipate more modest annualized returns compared to the significant gains seen in recent years [9].