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Investing.com – Palantir (NASDAQ: ) stock may face more challenges in 2025 amid several downside risks, Jefferies analysts said Monday.
The company’s shares are down 15% year-to-date (YTD), yet the stock still trades at 46 times trailing-twelve-month earnings (EV/NTM rev ), which is more than double the budget of the next highest software. company. This estimate comes after the stock had a 341% rally in 2024.
Analysts at Jefferies note that insider sales are increasing, with CEO Alex Karp selling Palantir stock worth more than $2 billion and other executives selling more than $600 million in the past five months. The increase in insider trading through Rule 10b5-1 business plans can cause significant material damage.
Palantir has seen its EV/NTM contract multiples increase 15% YTD, falling from 55 times to 46 times, following a 282% increase in multiples by 2024.
“The last time we saw such a high volume of multiple expansion was during the Covid bubble when many high-growth names saw their volumes expand significantly at the same time,” the analysts said. those led by Thill said in a letter.
“However, we are now in normal macro conditions, and we think that any negative factors (interest rate changes, AI hype, internal sales, etc.) can cause the majority of PLTR is pushing harder,” they added.
Analysts also point out that Palantir’s shareholder structure has changed recently, with institutional ownership increasing by five percentage points to 32% following the company’s December 23, 2024 merger. This change, according to analysts, could reduce the retail premium further.
Jefferies reiterated an Underperform rating on Palantir stock and a price target of $28, which means there is a slight upside of 56% from the last closing price.
