The once high-flying Palantir stock is currently experiencing a significant drop, with no signs of recovery in sight. On Wednesday, the stock plummeted by 8.75% to $15.55, reaching its lowest point since November 2022. This decline has pushed the shares below their 50-day moving average, which stood at $16.16, marking the first time since May. As a result, considerable technical damage has been inflicted on the stock. It has broken its previous upward trend line at around $17 and breached its initial support level near $16. The situation worsens as the stock has fallen for six consecutive days, experiencing a 22% loss during this unfortunate losing streak. These recent developments make it the worst six-day performance since May 2022.
The sudden decline in Palantir stock is quite perplexing. Just a few days ago, on August 1, the stock impressively peaked at $19.99, representing an increase of 211% since the beginning of the year. Additionally, Palantir delivered positive earnings in their Monday report, meeting analyst predictions by reporting a profit of 5 cents per share. Furthermore, they raised their revenue guidance and even announced a significant $1 billion stock buyback. Many analysts responded positively to these figures, with some even raising their price targets and maintaining an “Outperform” rating.
However, despite these initially encouraging results, the stock began to slide due to slower revenue growth and a modest increase of only $2 million in sales guidance. Analyst Rishi Jaluria from RBC commented that the quarter’s performance was “mixed, at best,” citing the deceleration in growth and weak leading indicators.
Looking ahead, if the downward trend continues, investors must brace themselves for potential support levels at $15 and $14. Moreover, a more concerning scenario would be if Palantir stock dips below its 200-day moving average of $10.
The future remains uncertain for Palantir, and only time will tell if the stock can regain its former glory.