TLDR
- Michael Burry published a detailed critique of Palantir on his substack, estimating fair value at $46 per share with a range of $21 to $146.
- Burry is not shorting PLTR directly but holds put options on the stock, taking a bearish position on its current valuation.
- He argues Palantir’s valuation has drifted far beyond what business fundamentals can support, warning investors against ignoring traditional metrics.
- Technical analysis from Alex Dudov suggests PLTR could drop below $100 before finding support, with a potential target zone around $70.
- Burry’s critique focuses on both valuation concerns and Palantir’s leadership culture, arguing the stock trades on aura rather than fundamentals.
Michael Burry just threw cold water on Palantir Technologies’ AI-fueled rally. The investor famous for predicting the 2008 financial crisis published a lengthy analysis questioning whether PLTR’s current price makes any sense.
Palantir Technologies Inc., PLTR
His bottom line? The stock might be worth around $46 per share. That’s a far cry from where it trades today after its monster run through 2024 and 2025.
Burry didn’t just throw out a single number and walk away. He laid out a valuation range stretching from $21 to $146 per share. He made clear these aren’t traditional Wall Street price targets. Instead, they represent different scenarios based on the company’s actual business performance.
The timing matters. Palantir has become one of the hottest AI stocks on the market. Investors have piled in, betting big on the company’s data analytics platform and artificial intelligence capabilities. That enthusiasm has pushed the valuation to levels that Burry thinks have lost touch with reality.
His critique goes deeper than just numbers on a spreadsheet. Burry spent considerable time examining Palantir’s corporate culture and leadership style. He argues the stock trades on leadership aura rather than cold, hard fundamentals. Under pressure, he believes that type of valuation will crumble.
“I believe Palantir’s recent winning streak will not endure,” Burry wrote in his substack piece titled “Palantir’s New Clothes: Foundry, AIP & the Failure of Reason.” The article is forcing Wall Street to reconsider assumptions about the company’s valuation.
Burry made one thing clear upfront. His critique isn’t personal. He’s not taking shots at CEO Alex Karp or the leadership team. That distinction matters because Palantir critics often get dismissed as attacking the company’s unique culture rather than analyzing the business itself.
Burry’s Position and Technical Warning Signs
Burry revealed he’s not shorting Palantir outright. Instead, he holds put options on the stock. The distinction is subtle but important. Put options give him downside exposure without the unlimited risk of a direct short position. It’s still bearish, just with defined risk parameters.
The technical picture backs up Burry’s concerns. Analyst Alex Dudov released research showing PLTR stuck in a corrective pattern with substantial downside risk. The stock is testing the $100 level, which serves as both a psychological and technical inflection point.
Dudov’s analysis points to a potential target zone around $70 per share. That’s where institutional buyers might finally step in with real conviction. Until then, the stock remains vulnerable to selling pressure as it works through its correction.
The technical structure suggests Palantir completed an impulsive rally phase and now faces a multi-stage correction. This pattern is typical after strong advances. The market needs to find equilibrium and discover where real demand exists at lower prices.
Valuation Takes Center Stage
The core issue is straightforward. Palantir’s valuation has climbed to heights that require perfect execution and sustained growth to justify. Burry’s analysis suggests those assumptions might be too optimistic given the company’s actual business fundamentals.
His fair value estimate considers multiple factors. Revenue growth rates, profit margins, competitive positioning, and market opportunity all play into the calculation. The resulting $46 figure represents what Burry believes the business is actually worth today.
The wide range from $21 to $146 reflects uncertainty about future outcomes. Different growth scenarios, margin profiles, and market conditions could push the fair value higher or lower. But even in optimistic cases, Burry sees limited justification for current price levels.
This creates a dilemma for investors who bought into the AI narrative. Do they stick with the growth story and ride out volatility? Or do they take profits and wait for a better entry point at lower valuations?
Market structure analysis suggests patience might pay off. Institutional money appears content to wait for cheaper prices before building positions. That lack of buying support at current levels keeps downward pressure on the stock.
Traders should watch the $100 level closely. A break below could accelerate movement toward the $70 target zone where buyers may finally emerge. Until then, PLTR remains in price discovery mode as it searches for a sustainable bottom.
Burry revealed he holds put options on Palantir while technical analysis points to a potential decline below $100 with a target zone around $70 per share.
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