In the last seven days, Palantir stock (NASDAQ: PLTR) has seen prices increase by 14.07%, up to $91.68 at press time on April 15.
However, data retrieved by Finbold from market intelligence platform Fintel suggests that PLTR bears haven’t lost steam. On the contrary, the short volume ratio of Palantir stock has risen from 49.88 to 67.21 in the same timeframe. Although it is currently slightly below a high of 67.77 seen on Friday, April 11, this still represents a significant degree of bearish sentiment.
Let’s examine the current state of affairs and whether or not such an outlook is warranted.
Palantir stock is benefiting from several bullish catalysts, but key concerns remain
First, let’s take a look at what is driving the current increase in Palantir stock price. One cannot discount the impact of market-wide trends. The tariff pause announced by President Trump has provided a temporary respite from present concerns. In addition, the recent news that the data analytics company will procure its Maven Smart System for NATO, as well as potential benefits from the controversial SAVE Act, provide tailwinds.
While PLTR is mostly immune to tariff risks, it isn’t immune to a broader market downturn, which, as we’ve seen, would result from an intensified trade war.
Moreover, PLTR stock is in quite a vulnerable position, as it already has a lot of growth factored in. At present, it is trading at a forward price to earnings (P/E) ratio of 197.06 — far above both peers and rivals.
Some analysts, like Jefferies’ Brent Thill, are already predicting a crash to levels as low as $60. Lastly, high levels of short interest are nothing new for Palantir, and key insiders, like Chief Executive Officer (CEO) Alex Karp, continue to liquidate large amounts of the stock.
Ultimately, market-wide dynamics will determine near-term price action. As PLTR has demonstrated a high degree of volatility, it stands to either benefit more than the average stock in case of a stock market rally, or suffer greater losses in the event of a bear market.
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