Renowned short-seller Andrew Left's Citron Research has issued a bearish report on Palantir Technologies Inc. (NASDAQ:PLTR), arguing the stock is significantly overvalued and its price is "detached from fundamentals and analysis".
Check out PLTR’s stock price over here.
‘OpenAI At $500 Billion Puts Palantir At $40’
Using OpenAI's recent $500 billion valuation as a benchmark, Citron calculates a price of $40 per share for Palantir, a figure the report labels as generous.
The report’s central argument hinges on a direct valuation comparison. OpenAI, which recently confirmed plans to sell stock valuing it at $500 billion, is projected to generate $29.6 billion in 2026 revenue, giving it a lofty price-to-sales multiple of nearly 17x.
Applying that same multiple to Palantir's consensus 2026 revenue forecast of $5.6 billion implies a stock price of approximately $40. However, Citron asserts that even this valuation is too high, stating, "at $40, PLTR would still be expensive".
OpenAI’s ‘Unprecedented’ Growth Versus PLTR’s ‘Steady Progress’
Citron argues Palantir does not deserve to trade at the same multiple as OpenAI for several reasons. The report highlights OpenAI's "unprecedented" revenue growth compared to Palantir's "steady progress".
It also contrasts OpenAI's scalable subscription model with Palantir's reliance on "lumpy, less scalable revenue" from government contracts.
The report describes the key difference starkly: "OpenAl is a self-reinforcing growth engine, while Palantir is essentially locked-in consulting wrapped in software".
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Papa Karp’s Insider Selling Dents Optimism
Further strengthening its case, Citron points to significant insider selling by Palantir CEO Alex Karp, also famously known as Papa Karp in the meme community, who has sold nearly $2 billion in shares over the past two years.
The report concludes that while Palantir's team should be proud, for investors, "discipline kicks in," and the stock's price "already reflects success beyond its fundamentals".
Andrew Left Slams Jim Cramer For ‘Negligent’ PLTR Promotion
Last week, Citron slammed Cramer for what it called a "negligent" promotion of the data analytics company, revealing that the firm holds a short position against the stock and labeling it a "high-multiple, hype-driven narrative."
The public dispute ignited on Aug. 12, after Cramer posted an enthusiastic message on X, stating, "Palantir making its run to $200 price target. Won't have to wait too long!!!" Citron Research responded directly the next day, questioning Cramer's pivot from market commentator to "full-blown stock promoter."
Price Action
Palantir fell 1.77% to $174.03 on Monday and declined 0.53% in after-hours trading. In pre-market on Tuesday, the stock was down 0.58%. The retail favorite has gained 131.45% on a year-to-date basis and 435.48% over the past year.
Benzinga's Edge Stock Rankings indicate that PLTR maintains a stronger price trend in the short, medium, and long terms. However, the stock scores poorly on value rankings. Additional performance details are available here.
The SPDR S&P 500 ETF Trust (NYSE:SPY) and Invesco QQQ Trust ETF (NASDAQ:QQQ), which track the S&P 500 index and Nasdaq 100 index, respectively, were lower in premarket on Tuesday. The SPY was down 0.098% at $642.67, while the QQQ declined 0.13% to $576.37, according to Benzinga Pro data.
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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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