Palantir stock falls 8% as valuation concerns grow

Palantir Technologies’ stock slid 8% on Tuesday after investors questioned its high valuation, despite the company’s strong quarterly results and upbeat revenue forecast, intensifying Wall Street’s concerns.

CEO Alex Karp blasted short sellers on CNBC’s Squawk Box, calling their moves market manipulation and saying they were shorting one of the great businesses of the world.

Palantir recently posted revenue above $1 billion for the second straight quarter, lifting its full-year guidance and beating Wall Street expectations.

The data analytics firm’s shares have surged over 170% this year and nearly 1,000% in the past two years. It expects strong fourth-quarter growth driven by soaring demand for its AI-driven services.

It continues to benefit from major US government contracts, including defense projects.

However, investor caution grew after Big Short investor Michael Burry revealed short positions against both Palantir and Nvidia, warning of a possible bubble in the AI sector.

Analysts noted that Palantir’s valuation is around 250 times its forward earnings, compared to Nvidia’s 33 and Microsoft’s 30, fueling skepticism.

If losses persist, the company could wipe out more than $33 billion in market value, pausing its remarkable rally.