Over the past year, the name Palantir Technologies has garnered increasing attention in the field of artificial intelligence. Their AI platform (AIP) has achieved significant productivity gains, causing the company's stock to quadruple over the past year. Several industry commentators have differing opinions on this, pondering whether to continue holding their shares or to sell off a portion.

The recent decline in Palantir's stock price reminds us that stock prices do not always rise. Justin Pope pointed out that investors holding Palantir Technologies have indeed enjoyed an exciting journey over the past few years. Since the beginning of 2023, its stock price has increased by 2300%, closely related to the surge in AI at that time. Although the rise seems like a "dot-com bubble," Palantir is not that simple. The company has gradually attracted commercial clients by leveraging early government relationships, customizing AI solutions for them, from optimizing supply chains in manufacturing to improving the grids of power companies. All of this has led to sustained revenue growth. It seems that market expectations for Palantir have been gradually pushed higher, but the market capitalization of the stock has reached $367 billion, while its annual sales are less than $4 billion. Such high valuations often lead to dramatic fluctuations in the company's stock price. In light of this, investors need to be wary of risks and prepare for potential ups and downs.

Will Healy believes that it is not easy to label a stock as a "bubble." He mentioned that even though Palantir's stock price seems to have reached "bubble" territory, its price-to-earnings ratio still shows a strong growth momentum, with a dynamic P/E ratio of 241. Compared to the S&P 500 average of 3.2, Palantir's price-to-sales ratio is as high as 114, indicating that its stock price exceeds its fundamentals. Nevertheless, due to the productivity enhancements it offers, the market has naturally pushed up the stock price. However, investors should be cautious, as ultimate valuation will always influence choices.

For Jake Lerch, the recent decline in Palantir's stock price is closely related to uncertainty. These issues are not only about its total market capitalization, long-term profitability, and revenue growth rate, which are common concerns among public companies, but also because Palantir is at the forefront of AI and is easily viewed as a bubble by critics. It is worth noting that the comparison between AI and the internet bubble is resurfacing for a reason. However, compared to many unprofitable "bubble" companies, Palantir generated $3.4 billion in revenue, $1.7 billion in net profit, and nearly $800 million in free cash flow over the past 12 months. Therefore, despite facing volatility recently, he believes that Palantir and the entire AI sector are not a bubble.

Overall, although Palantir's stock is expensive and may continue to decline, the technology and growth potential behind it are real. Long-term investors should not let recent fluctuations shake their confidence, and continuing to pay attention to its development in the AI field remains a worthwhile consideration.