Sell Palantir Due to Elevated Valuations

about 1 month ago

John Tinsman

"So I took Palantir out of the portfolio, right? I mean, I think that like you need to hold the price to sales constant, but when you see stuff like at a hundred or even 50, you think like that's going to be hard to get a good return over the next three years."

The speaker explicitly mentioned removing Palantir (ticker PLTR) from the portfolio primarily due to its elevated price-to-sales ratio. The rationale centers on the importance of maintaining valuation discipline within a growth portfolio that is built on low marginal cost fundamentals. By trading off high-growth companies that maintain low marginal cost and strong earnings expansion, the manager rebalances the portfolio to optimize long-term performance.

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