Palantir Stock Drops Following Bearish Prediction by Investor Michael Burry
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Feb 12 2026
0mins
Should l Buy PLTR?
Source: Fool
- Stock Decline: Palantir Technologies saw its stock drop as much as 6.7% on Thursday, with a 5% decline still noted by 2:00 p.m. ET, reflecting market concerns about its future performance.
- Investor Prediction: Notable investor Michael Burry released a 10,000-word thesis predicting a potential 66% drop in Palantir's stock price to around $46, although he presented various scenarios, his overall outlook remained bearish.
- Analyst Perspective: Analysts at D.A. Davidson reaffirmed their neutral rating and $180 price target for Palantir, asserting that Burry's article lacked new evidence to alter their view, emphasizing the company's growth and strong cash flow.
- Valuation Debate: Despite Palantir's high price-to-earnings ratio of 202, analysts questioned Burry's stance, arguing that the company's ability to grow rapidly while maintaining high cash flow margins indicates the sustainability of its business model.
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Analyst Views on PLTR
Wall Street analysts forecast PLTR stock price to rise
17 Analyst Rating
5 Buy
10 Hold
2 Sell
Hold
Current: 146.490
Low
50.00
Averages
192.88
High
255.00
Current: 146.490
Low
50.00
Averages
192.88
High
255.00
About PLTR
Palantir Technologies Inc. is engaged in building software to assist in counterterrorism investigations and operations. The Company has built four principal software platforms, including Palantir Gotham (Gotham), Palantir Foundry (Foundry), Palantir Apollo (Apollo), and Palantir Artificial Intelligence Platform (AIP). Apollo is a cloud-agnostic, single control layer that coordinates ongoing delivery of new features, security updates, and platform configurations, helping to ensure the continuous operation of critical systems. Gotham enables users to identify patterns hidden deep within datasets, ranging from signals intelligence sources to reports from confidential informants. Foundry transforms the ways organizations operate by creating a central operating system for their data. AIP enables responsible artificial intelligence (AI)-advantage across the enterprise by using primary, core components built to effectively activate large language models and other AI within any organization.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Rising Operating Costs: As revenue increases, Figma's operating costs, particularly in research and development and sales/marketing, are also rising, leading to escalating losses that suggest its growth may not be sustainable.
- Dismal Investment Return Outlook: Despite Figma's market capitalization reaching $10 billion, the expected return on its stock over the next few years may be limited, prompting investors to carefully assess its long-term investment value.
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- Market Reaction: The current price action in software stocks indicates heightened investor concerns over SaaS companies losing pricing power, particularly as AI can autonomously coordinate tasks across multiple interfaces, leading to potential deceleration in subscription sales.
- Competitive Threat: Claude CoWork's ability to read and synthesize data from spreadsheets, emails, and legal documents to generate project management timelines or compliance summaries poses concrete threats to enterprise software giants like Atlassian and Salesforce.
- Palantir's Advantage: While Claude CoWork excels in routine office operations, Palantir's AI Platform (AIP) maintains irreplaceable value in critical missions due to its deep integration and compliance in high-stakes environments.
See More
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- Semantic Layer Advantage: UBS analyst Karl Keirstead highlights that Palantir's ontology layer transcends a mere thin data semantic layer, transforming raw enterprise data into actionable objects, thereby enhancing data trustworthiness and reusability, which boosts customer decision-making capabilities.
- Significant Competitive Barrier: Palantir's Foundry platform excels in metadata graphing and mapping, defining relationships between data and connecting it to relevant customer operations and systems, creating a competitive edge that is difficult to replicate.
- Positive Customer Feedback: Keirstead notes that Palantir's customers have not cited any viable alternatives, indicating the company's unique market position, with no evidence suggesting a threat to its market share.
- Optimistic Future Outlook: UBS maintains a Buy rating on Palantir with a price target of $200, asserting that while AI models have made strides in certain data engineering tasks, the likelihood of disruption to Palantir remains low, underscoring its sophisticated data mapping and decision-making capabilities.
See More
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- Significant Earnings Growth: The company's earnings per share grew by 232% year-over-year in 2025, indicating substantial progress in profitability, although profit margins reached a new high of 43% in Q4 2025, up from 10% in Q4 2024, showcasing remarkable improvement.
- Cautious Market Response: Despite the PEG ratio indicating some undervaluation potential, the market remains cautious about Palantir's high valuation, and the investor's risk tolerance will directly influence their investment decisions regarding the stock.
- Sustainability of Profitability: While Palantir may continue to enhance its margins, the quadrupling of profit margins is unlikely to be sustainable, suggesting that future earnings growth may face challenges, prompting investors to monitor the stability of its long-term profitability.
See More
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