Palantir Shares Face Mounting Investor Skepticism

Palantir US69608A1088

A strategic shift by Peter Thiel, co-founder of Palantir and renowned technology visionary, is sending ripples across financial markets. His complete divestment from AI favorite Nvidia raises fundamental questions about the sector's future trajectory. While Palantir continues breaking operational records, prominent investors are suddenly positioning for potential declines—does this signal a market top or merely a temporary consolidation phase?

The central concern remains Palantir's astronomical valuation. With a market capitalization approaching $400 billion and a price-to-earnings ratio of similar magnitude, the stock has absolutely no room for operational disappointments. This excessive valuation is attracting prominent bearish investors.

Michael Burry, who achieved legendary status by predicting the 2008 financial crisis (as depicted in "The Big Short"), is taking an aggressive stance against Palantir. He acquired put options covering millions of shares, directly betting on a price decline. Simultaneously, CEO Alex Karp is selling substantial personal holdings worth approximately $96 million, further fueling skepticism—even though these sales were pre-arranged.

Major Portfolio Reshuffling Raises Questions

Recent disclosures revealed startling portfolio changes: Peter Thiel completely liquidated his Nvidia position during the third quarter of 2025. The divestment involved shares valued at roughly $93 million. But the strategic shift didn't stop there—the star investor also significantly reduced his exposure to Tesla.

Instead, capital flowed toward established technology giants like Microsoft and Apple. This defensive repositioning has alarmed market observers: Is one of the most influential AI investors anticipating turbulence ahead? The rotation away from pure AI high-fliers toward more diversified corporations might indicate that sector enthusiasm has peaked.

Strong Fundamentals Contrast With Price Action

Paradoxically, the current market nervousness starkly contrasts with the data analytics specialist's operational excellence. Third-quarter results demonstrated explosive performance:
* Revenue Surge: A 63 percent year-over-year increase shattered Wall Street expectations
* Commercial Growth: U.S. commercial business skyrocketed by 121 percent
* Contract Volume: New agreements totaling $2.8 billion underscore massive demand

Despite these impressive figures, the equity has recently succumbed to downward pressure, currently trading around €144—approximately 20 percent below its early November 52-week peak.

While major contracts with the U.S. Army reinforce the company's dominant market position, the tension between fundamental strength and extreme valuation will likely dictate trading patterns through year-end. Market researchers remain cautious, with most maintaining only "Hold" ratings on the stock.