Palantir's Valuation Leaves Little Margin for Error
"Palantir is a real business. It solves real problems, and it's showing real progress. But great companies don't automatically make great investments, especially after a big runup like it's had. Palantir doesn't need to become Nvidia to be successful. But today's price already assumes an Nvidiaike outcome. So the margin of error has gone away and it's gone completely. When Palantir was beaten down, the expectations were low. The market didn't believe in the story anymore. Didn't believe the profitability was near and didn't trust in management's execution. That created an opportunity for investors who are willing to look past the noise."
The speaker highlights that while Palantir shows strong business fundamentals and real progress, its current high valuation is predicated on an optimistic, Nvidia-like outcome. This leaves little margin for error, suggesting that investors should be cautious and carefully assess the price versus intrinsic value before investing.
Palantir Overvaluation Suggests Funding Short
"Yeah, my second prediction was that Palunteer would get cut in half. And I could not have been more wrong. The stock finished up 157% in 2025 so far, but I still think it's going to be a fantastic funding short over the next decade just given the absurd valuation. I'm calling this the Palunteer zone—when a stock hits 50 to 100 times sales, it's time to consider a short."
The speaker reflects on his prediction regarding Palantir (noted as Palunteer) and, despite his forecast of a 50% drop proving wrong, maintains a strong conviction that the stock's excessively high price-to-sales multiples make it an attractive candidate for a funding short over the next decade.
Palantir: Deep Base Turnaround from 47% Decline
"One example that I wanted to share was a stock that I currently own. Full disclosure, it's Palenter PLTR. You know, from that February 2025 peak, it fell 47% and yet was able to become a winner in 2025. And it wasn't just the fundamentals. Obviously, you need the support of individual investors as well as institutional investors. Even though the data doesn't show a lot of sponsorship on the institutional side, you can see that the price action and the volume really supported this stock's big move."
The speaker discusses Palantir (PLTR) as an example of a stock that experienced a significant 47% decline from its February 2025 peak but bounced back to become a winner later in the year. He highlights that strong price action and high volume, despite limited institutional sponsorship, supported the stock's recovery, affirming its strong fundamentals and attractive technical setup.
Palantir Company Commentary: Government Contracts and Exponential Growth
"Palantir works with large government organizations such as the US Army and the Navy and provides information on warfare monitoring. Hence why the company is so secretive. Their client list includes hedge funds, banks, pharma companies like Merc, automobile company Ferrari and much more. Palantir is going to be massive. They have tons of government contracts used widely in the intelligence community. In fact, they have $1.5 billion in federal government contracts alone. My thought is if they can get into tracking COVID or other emerging viruses, it'll be a gamecher and it'll just become a blue chip company at that point."
The speaker emphasizes Palantir's robust government contracts and secretive clientele, highlighting $1.5 billion in federal deals. He believes these factors, combined with potential expansion into areas like virus tracking, position the company for blue chip status and exponential growth.
Palantir Trade Call: Options Strategies for Leveraged Gains
"If you want to take advantage of that, there's basically three trades that I would be making right now. I'd be selling puts to get in to Palantir. I'd be selling 170 puts right now. At any point in time, I would be selling puts that are around a 30 delta to try to acquire more shares of Palantir. Number two, what I would be doing is I'd be running the wheel strategy on Palunteer, which is selling puts to get into Palantir. Once you're assigned, doing covered calls and then if those covered calls go into the money, rolling those covered calls higher and just riding Palunteer for the next five years."
The speaker outlines three actionable trade ideas centered on Palantir using options strategies. He recommends selling 170 puts with roughly a 30 delta to accumulate shares, running a wheel strategy with covered calls, and buying deep in-the-money LEAP call options for long-term leveraged exposure.
Caution on Palantir's Risky Valuation Heading into 2026
"Next up, we have Palantir, which obviously just looking at the numbers here by any relative scale, this thing is goated. Like it's been an insane year in 2025 for Palunteer. Now you can complain. You can say that it's not deserved or the stock is comically overvalued, but say whatever you want. The numbers are the numbers. First of all, the revenue is growing very fast, 47%. Like I said earlier, premium revenue growth equals premium multiples, premium valuation. Palenter investors are betting that this continues because if this reverts, if it slows down or decelerates, the multiple will come down dramatically. Now this again is very impressive how fast they've been able to grow. But I am concerned if the revenue does slow down because I think we'll see a big derating in this company if it does. So while this company has been goated, I feel like going into 2026, it's much higher risk than an ASML or Google. I think you're really playing a dangerous game investing in Palunteer in 2026 at these valuations."
The speaker reviews Palantir's explosive performance in 2025, noting its 148% gain and high revenue growth of 47%, while warning that a slowdown in growth could lead to a significant multiple compression. Despite the impressive numbers, he cautions investors that entering at such high valuations in 2026 is dangerous compared to more stable plays like ASML or Google.
Palantir's AI Operating System Opportunity
"Anyway, Palantir is quickly becoming the AI operating system for enterprises and governments through Gotham Foundry and their artificial intelligence platform or AIP. These platforms act as digital AI infrastructure by integrating fragmented data, presenting it as an ontology and letting customers plug in large language models and decision logic directly into their real world workflows from manufacturing and logistics to finance and defense. I cover Palunteer pretty often because I think it's the best way to own the application wear of AI infrastructure. If companies want AI co-pilots they can trust to make important decisions and take automated actions, Palantir's platforms are how they need to do it."
The speaker highlights Palantir (referred to as 'Palantir' in the transcript) as a key player in AI infrastructure, emphasizing its role as the operating system for enterprises and governments by integrating fragmented data and enabling AI-powered decision making across various industries.
Long-Term Growth Story with Palantir (PLTR)
"Well, you know, I can't do a video like this without talking about Palantir, and that's my stock. It's had a great year. I expect it to continue to have another solid year next year. I think the honeymoon phase is over for Palantir. I don't think investors should be expecting to see a stock like what it did when it went from under $20 to now at one point this year it was over 180. That hyper growth phase initially is over. It's going to quiet down a little bit, but there's no reason to believe that this stock is going to have, in my opinion, a significant pullback or there's going to be a significantly less demand for the company's services. They proved that they could scale profitability, they're growing profits astonishingly year-over-year, and they've become a core part of AI infrastructure."
Chris underscores Palantir's (PLTR) remarkable rise and asserts that despite the end of its hypergrowth phase, its proven profitability and deepening role in AI infrastructure make it a strong long-term hold, with expectations for continued growth over the next several years.
Short Call on PLTR Due to Extreme Valuation
"My short Palantir really comes down to a few reasons. First, this is one that you can't just solely base a short position on is valuation. But with this one, it's pretty damn extreme. I've called it the most overvalued stock ever; the stock trades at over a hundred times trailing sales — about 113 as of this writing. Look, this is going to be a massive headwind, especially with shareholder dilution coming down the pipeline. And frankly, what helps is that right now they have a buyback to nowhere. They're buying back stock at these levels, which goes to show the unsustainable nature of its current valuation."
The speaker outlines a short trade call on Palantir (represented by the ticker PLTR) citing extreme overvaluation at approximately 113x trailing sales and significant dilution risks from a buyback program that adds little shareholder value. The commentary also positions this short as a hedge in a potential market downturn.
Momentum Buy Signal and Accumulation Strategy for PLTR
"For traders, a break above 195 is the momentum buy signal. long-term investors. Any dip near 155 represents a high quality accumulation zone. So why Palens here? Well, I like Palenteer because it's not just software. It's missionritical data infrastructure and that's gaining traction with governments and enterprises. If the catalysts play out the 2026 setup could be very meaningful, very prosperous for investors and traders alike."
The speaker lays out a dual trade strategy for PLTR, where a breakout above 195 signals a momentum buy for traders while any pullback to around 155 offers a strong accumulation opportunity for long-term investors. The commentary is supported by technical levels and underlying fundamental catalysts, indicating high conviction for the stock's future potential.