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Palantir Technologies Inc. (PLTR) Shows Positive Momentum but Caution Advised

StockInvest.us, 1 month ago

Palantir Technical Analysis

Palantir Technologies Inc. (PLTR) closed at $17.06 as of October 19, 2023, a slight decrease of -0.81% from the previous session. This shift was narrower than the S&P 500's daily loss. The stock fluctuated between the day's low at $16.97 and the high at $17.58. The 52-week range lies between $5.92 (year low) and $20.24 (year high).

The market capitalization stands impressively at $36.71 billion and volume represents 45.67 million. The current average volume is reported to be 61.79 million. The RSI14 of 59 indicates the stock is neither overbought nor oversold. The 50-day moving average is $15.56, and the 200-day moving average is $12.07, both below the current price, suggesting an ongoing uptrend.

The MACD (3-month) is 0.74 implying upward price momentum, and the ATR of 5.04 indicates a higher level of volatility. The immediate support and resistance levels are seen at $17.04 and $17.61, respectively.

Fundamental Analysis

Palantir has an EPS of -$0.02 which indicates the company is presently running losses. The PE ratio reported is -853. Although negative PE can be off-putting, it can also mean the company is expected to turn profitable soon. There are 2.15 billion shares outstanding. The discounted cash flow (DCF) is calculated at $18.32 suggesting a potential over-valuation of the stock under the present settings.

Palantir Analysts have set a high price target of $25 and a low price target of $4.5, with a median target at $9.5, and a consensus target of $11. Out of the analyst recommendations, 7 ranked it as a 'Buy', while 3 suggested a 'Sell', and 1 recommended 'Hold'. The overall consensus leans towards 'Buy'.

Market Sentiment

The financial news has been extremely positive for Palantir. Their potential in the AI sector could give a significant boost to its financials. The addressable market largely increased due to AI – this increase could greatly propel the stock further over the next five years. Their resilience in avoiding a government shutdown and the ongoing choppiness in the financial markets also adds strength to the company's outlook.

Forecast and Final Evaluation

Factoring in the existing technical and fundamental factors, and taking the positive news sentiment into account, the prediction for Palantir Technologies Inc. (PLTR) stock points towards a Bullish trend for the next trading day, October 20, 2023, and the upcoming week.

However, given the recent upsurge in price, which puts it above the 50 and 200-day moving averages, and the MACD showing an upward price momentum, potential investors should exercise caution as the stock may experience a consolidation phase or possible pullback towards the DCF estimate of $18.32.

In conclusion, Palantir Technologies Inc. (PLTR) is rated as a 'Hold' because, while the stock shows positive momentum and solid market sentiment, the current indicators suggest that it might be overvalued, and potential swings in price might occur in the short term. Investors would benefit from observing and reassessing market conditions for PLTR before making investment decisions.

Check full Palantir forecast and analysis here.