The end of Palantir? (Why $PLTR is down and keeps dropping?)

Summary

In this video, Tom Nash addresses concerns about Palantir's recent stock decline, attributing it to profit-taking and short-seller sentiment rather than any fundamental changes. He draws comparisons to Nvidia's growth after similar negativity in 2016, emphasizing that long-term investors should focus on fundamentals over short-term market noise. Nash highlights Palantir's dominance in the AI space and its strong business model, despite the risks involved. He also shares an inspiring success story from his Discord community, reminding viewers to stay patient and focused on the long haul.

Takeaways

• 😀 The current decline in Palantir's stock is due to a combination of profit-taking after a recent spike and negative sentiment from a short-seller's tweet.
• 😀 No major fundamental change occurred with Palantir; the drop is primarily short-term noise, not driven by poor company performance or lost contracts.
• 😀 Despite some short-term volatility, long-term investors should focus on the strong fundamentals of Palantir, similar to how Nvidia's stock grew despite early skepticism.
• 😀 Palantir's valuation may seem high in the short term, but the company is well-positioned for long-term growth, especially in the AI space.
• 😀 Tom has been advising to trim profits if you're sitting on large gains with Palantir, as an insurance policy against potential market volatility.
• 😀 Palantir has shown immense growth, with major deals signed, including one with Fujitsu for $100 million, and substantial increases in its US commercial sector.
• 😀 Palantir's software is uniquely suited for high-compliance, high-stress environments, and it dominates its market with unmatched capabilities in AI and data processing.
• 😀 The company’s commercial success is growing, with significant wins from top-tier clients like Airbus, BP, and Hyundai, and an overall 93% increase in US commercial deals.
• 😀 While Palantir's stock may see fluctuations in the short-term, the company’s dominance and market leadership in AI software suggests it could eventually reach valuations as high as $1,000 per share.
• 😀 Even with its high valuation and risks (e.g., regulatory, execution, client concentration), Palantir is well-positioned to lead the AI software sector alongside Nvidia in hardware.
• 😀 Tom stresses the importance of patience and long-term investing, emphasizing that short-term market movements should not dictate your strategy if you believe in the company’s fundamentals.

Q & A

What is causing Palantir's stock to decline in this situation?

Palantir's stock is declining due to a combination of profit-taking after a long price spike and negative sentiment sparked by a short seller's post, claiming that the stock is overvalued. The overall market behavior is considered normal, despite the short-term volatility.

What is Tom Nash's perspective on the short seller's claim about Palantir's valuation?

Tom Nash acknowledges the short seller's right to share their opinion but highlights that short-term noise like this shouldn't overshadow the long-term potential of the company. He draws a comparison to Nvidia's rise after a similar situation in 2016, suggesting that long-term fundamentals can overcome short-term negativity.

How did Nvidia's stock perform after a similar short-seller claim in 2016?

Nvidia's stock grew almost 100x after the short-seller claim in 2016, demonstrating that long-term success can defy short-term predictions and market noise.

What is Tom Nash's general approach to investing in stocks like Palantir?

Tom Nash emphasizes the importance of focusing on long-term fundamentals rather than short-term fluctuations. He advocates for trimming profits when stocks become overvalued but believes in holding onto strong companies for the long run.

What does Tom Nash think about the current valuation of Palantir?

Tom acknowledges that Palantir's current valuation is high and potentially overhyped in the short term. However, he maintains his belief that the company is ultimately worth much more in the future, possibly reaching $1,000 per share.

What significant milestones has Palantir achieved recently?

Palantir has experienced significant growth, including a 93% increase in US commercial deals in Q2, a first billion-dollar quarter, and a 50% growth in government contracts. The company is also expanding its commercial sector dominance.

How does Palantir compare to its competitors in the AI industry?

Palantir is positioned as a superior player in the AI software space, solving complex enterprise data problems in seconds, complying with all regulatory standards, and integrating with multiple AI models. Its technology is highly specialized, particularly for high-compliance, high-stress environments.

What risks does Tom Nash see with Palantir?

Tom Nash acknowledges that Palantir carries risks, including its extremely high valuation, execution risks, regulatory challenges, and client concentration. However, he remains optimistic about the company's long-term prospects.

What is Tom Nash's strategy if Palantir's stock continues to drop?

If Palantir's stock drops, Tom sees it as an opportunity to lower his cost basis through dollar-cost averaging (DCA). He is focused on long-term growth rather than short-term market fluctuations.

How does Tom Nash feel about the social media reaction to Palantir's stock decline?

Tom finds the social media reactions to Palantir's stock decline entertaining, as many people who have struggled with the stock's performance are celebrating the drop. He remains unfazed by this negativity and focuses on the company's long-term fundamentals.