Amid a challenging day for the broader market, Palantir’s stock experienced a decline during Monday’s trading. The software company’s share price decreased by as much as 4.8% during the session, ultimately closing with a 3.2% drop. In comparison, the S&P 500 index fell by 2.4%, while the Nasdaq Composite index saw a 2.8% decline.
The stock market’s downturn was influenced by President Trump’s comments labeling Federal Reserve Chair Jerome Powell a “major loser” and suggesting a preemptive reduction in interest rates to bolster economic growth. These remarks, following reports that the Trump administration is investigating the legality of dismissing Powell, caused investor unease regarding the macroeconomic environment. Consequently, Palantir’s stock is now down 27% from its peak.
Palantir is currently valued at approximately 164 times this year’s expected earnings and 56.5 times expected sales, indicating one of the most growth-dependent valuations among major tech companies. Despite the typically high risk associated with such valuations, Palantir’s stock has shown notable resilience amid market volatility this year, rising by 20% in 2025.
The company is a leader in artificial intelligence (AI) software, helping business customers derive actionable insights from data, achieve efficiency improvements, and automate various initiatives. Palantir is also experiencing significant sales growth with government clients for defense and other applications, with its sales largely focused in the U.S. and allied nations, offering stability amid geopolitical uncertainty.
While a forward-looking valuation makes Palantir a high-risk investment, its strong position in the AI sector and established growth foundations suggest that it may be a worthwhile option for investors willing to take on higher risk.
The article includes a disclosure that Keith Noonan does not hold any positions in the stocks mentioned, and The Motley Fool has positions in and recommends Palantir Technologies. The Motley Fool’s disclosure policy is available for reference.
