2 Brilliant Growth Stocks to Buy Now and Hold for the Long Term

Key Points

Global corporate spending on data center infrastructure and compute is projected to surpass $600 billion in 2025, nearly double 2023's figure. A few technology companies are well-positioned to benefit from these massive investments, making them compelling long-term picks for retail investors.

Here are two such high-quality growth stocks that can generate exceptional long-term returns for shareholders and are worth considering now.

1. Nvidia

Once known primarily for its gaming GPUs, Nvidia (NASDAQ: NVDA) is now increasingly seen as a key driver of the modern artificial intelligence (AI) economy. The company's full-stack platform, which includes GPUs, CPUs, networking hardware, and proprietary Compute Unified Device Architecture (CUDA) software stack, powers cloud data centers, sovereign AI projects, and enterprise AI projects worldwide.

Nvidia expects global AI infrastructure spending to reach $3 trillion to $4 trillion by 2030. This includes the AI infrastructure required to support massive training and inference compute for reasoning agentic AI, sovereign AI projects, enterprise AI, physical AI, and robotics. The company is well-positioned to capitalize on this opportunity, especially after the launch of the Blackwell architecture systems (GB300 NVL72), which are 10x more power efficient compared to previous Hopper architecture systems. Since power limitation and excessive costs are major challenges for data centers worldwide, the power-efficient Blackwell systems are being increasingly adopted by cloud service providers and enterprises to train and run next-generation AI models.

Nvidia's software ecosystem has also played a critical role in building a sticky customer base. Used by almost 5 million developers and 40,000 companies, CUDA helps improve the efficiency and performance of AI workloads -- thereby locking clients in Nvidia's ecosystem. Nvidia's networking solutions, such as Spectrum-X Ethernet and InfiniBand, are also becoming essential for building massive AI clusters.

Nvidia also differentiates itself from its peers with its rapid pace of innovation, releasing new architecture while strengthening its customer relationships. The company is already working on Rubin architecture to follow the successful rollout of Blackwell systems.

Nvidia's recent financial performance underlines its dominant position. The company delivered $46.7 billion in revenue, representing a 56% year-over-year increase, in the second quarter of fiscal 2026 (ended July 27, 2025). Data center revenues increased 56% year over year to $41.1 billion, driven by the robust adoption of Blackwell systems and growth in networking. Gross margin was 72.4%, while operating income surged 53% year over year to $28.4 billion. The company also returned $10 billion to shareholders through buybacks and dividends, and expanded its authorization by an additional $60 billion, signaling confidence in long-term growth.

While Nvidia's stock is valued richly at 39.5 times forward earnings, the premium seems justified for a company with unmatched scale and technological edge in the booming AI market. Hence, the stock appears to be a brilliant buy-and-hold option for long-term investors.

2. Palantir

Enterprise software giant Palantir Technologies (NASDAQ: PLTR) is at the forefront in helping organizations make faster and more accurate data-driven decisions. Once known primarily as a contractor for the defense sector, Palantir's AI-powered solutions are now used extensively by both government and commercial clients. This has positioned it effectively as a long-term beneficiary of the ongoing AI revolution.

In the second quarter of fiscal 2025 (ended June 30, 2025), Palantir's quarterly revenues surpassed $1 billion for the first time in history, a 48% year-over-year increase. The company has also increased its profitability, with adjusted operating margin rising to 46%, nearly 300 basis points higher than the upper end of its guidance. The company's free cash flow also reached $569 million, implying a 57% margin.

The U.S. commercial segment has become a key growth driver, driven by the strong adoption of the company's Artificial Intelligence Platform (AIP). U.S. commercial revenues were up 93% year-over-year to $306 million in the second quarter. The U.S. Army also awarded Palantir a 10-year enterprise contract worth up to $10 billion. This multi-year contract has dramatically improved the company's revenue visibility.

Palantir's AIP differentiates itself from other enterprise AI solutions with its ontology-based architecture (mapping digital assets to physical assets). AIP integrates large language model capabilities with Palantir's ontology framework, making it more accurate, cost-effective, and reliable in resolving client challenges. Customers are seeing measurable impact -- from cutting onboarding times at banks from days to seconds to reducing fraud detection cycles from months to moments. This approach has created a sticky customer base, as evidenced by its 128% net dollar retention rate in the second quarter.

Palantir, however, is trading at costly levels. At more than 277 times forward earnings, Palantir trades at one of the highest multiples in the enterprise software sector. However, the stock can continue to grow even higher as the company delivers explosive top-line growth, achieves rising profitability, and secures long-term revenue contracts.

With $6 billion in cash on hand, ongoing buybacks, and a growing moat in AI infrastructure, Palantir may be a good pick for long-term investors. Investors can also opt for a dollar-cost averaging strategy and gradually build a position in this expensive but high-quality stock over a longer period of time.

Should you buy stock in Nvidia right now?

Before you buy stock in Nvidia, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Nvidia wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $654,759!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,046,799!*

Now, it’s worth noting Stock Advisor’s total average return is 1,042% — a market-crushing outperformance compared to 183% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

*Stock Advisor returns as of August 25, 2025

Manali Pradhan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Nvidia and Palantir Technologies. The Motley Fool has a disclosure policy.

2 Brilliant Growth Stocks to Buy Now and Hold for the Long Term was originally published by The Motley Fool

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Should You Buy Palantir Stock After Its 18% Drop in 3 Weeks?

Motley Fool

Key Points

Palantir Technologies (NASDAQ: PLTR) has been the best-performing stock in the S&P 500 this year. On Aug. 12, it touched an intraday high of $190 per share, 151% above where it started 2025.

Since then, however, shares have slipped significantly, dropping as much as 25% within a few days before recovering slightly. They still trade 18% below their all-time high.

Some investors may see the pullback as an opportunity to buy the high-flying AI stock before it takes its next leg up. Others may be wondering if there's still room for the stock to fall. Here is what's behind Palantir's sudden drop and whether it's worth buying at today's price.

Causes for concern at Palantir

There's no clear reason why the stock price declined rapidly over the last few weeks.

Investors moved away some from the high-flying AI software stocks, including Palantir since it hit its all-time high in mid-August. Small-cap stocks have made gains amid expectations the Federal Reserve will cut interest rates again in September.

CEO Alex Karp systematically sold some of his shares in order to cover his income taxes. Some may have seen the insider selling as a signal that it's a good price to take some money off the table as well.

Comments from OpenAI CEO Sam Altman may have scared off some investors as well. At a dinner with reporters, he suggested we're in the midst of a bubble in artificial intelligence. Altman said he believes AI is the most important technology to come along in a long time, but he thinks many people are overexcited about it in the near term.

To be sure, there's a lot to be excited about with Palantir. Its second-quarter earnings report in early August showed it grew its top line 48% year over year while producing an adjusted operating margin of 46%, obliterating the so-called Rule of 40 (which says a software company is investable if the sum of its revenue growth and adjusted operating margin exceeds 40).

That growth is supported by its Artificial Intelligence Platform (AIP), which allows businesses to use large language models to interact with and use its software. That opens the door for more-efficient uses and expands the user base to less technical businesses. As a result, Palantir saw its U.S. commercial revenue grow extremely quickly, up 93% year over year in the most recent quarter.

The company's government segment is still holding its own, too. Sales to the U.S. government climbed 53% last quarter, and it just signed a $10 billion deal with the military at the start of August.

So, Palantir's slide doesn't appear to be triggered by any of the underlying fundamentals of the business.

Is it time to load up on the stock?

Few companies in history can claim the level of profitable growth Palantir is exhibiting at scale. The business is already generating more than $4 billion per year in sales, and it's exhibiting strong operating leverage as it scales up.

But even after an 18% pullback in price, shares still trade at an astronomical valuation that can't be ignored. If you want to own Palantir today, you'll have to pay around 90 times analysts' sales expectations over the next 12 months.

Even if the company continues to grow its top line at around a 50% rate, it will take years for it to grow into that valuation. Its forward price-to-earnings ratio of 240 is also off the charts.

If we're actually in an AI bubble, Palantir stock is the poster child. As Altman said, "When bubbles happen, smart people get overexcited about a kernel of truth." It's true that the company is uniquely positioned to capitalize on a huge opportunity. But if the estimates for just how big that opportunity is -- or how much of that potential market Palantir can capture -- are off by just a little bit, the negative effect on the stock price will be magnified substantially by its current valuation.

There are other AI stocks worth considering amid the broader pullback in software names. With more-reasonable valuations, they may be a better fit in the portfolios of investors looking to capitalize on the continued growth of AI without taking on unnecessary valuation risk.

Should you buy stock in Palantir Technologies right now?

Before you buy stock in Palantir Technologies, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Palantir Technologies wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $651,599!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,067,639!*

Now, it’s worth noting Stock Advisor’s total average return is 1,049% — a market-crushing outperformance compared to 185% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

*Stock Advisor returns as of August 25, 2025

Adam Levy has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Palantir Technologies. The Motley Fool has a disclosure policy.

Should You Buy Palantir Stock After Its 18% Drop in 3 Weeks? was originally published by The Motley Fool

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Nvidia vs. Palantir: The Better Growth Stock to Own Today

Motley Fool

Key Points

In the tech and business world, no topic has been harder to avoid than artificial intelligence (AI). Over the past couple of years, it has been the topic. With this surge in interest has come a rise in the valuations of many tech stocks as investors rush to capitalize on new growth opportunities.

No two companies have benefited more from the AI hype than Nvidia (NASDAQ: NVDA) and Palantir (NASDAQ: PLTR). It has propelled Nvidia to the world's most valuable public company and pushed Palantir's stock price up over 810% since the beginning of 2024.

Both companies have produced generational returns, but if you had to choose one of the growth stocks to invest in, which is the better choice?

What Nvidia has going for it

Nvidia is undoubtedly one of the most important companies in the AI world. It produces graphics processing units (GPUs) that power data centers, making it possible to train, deploy, and scale AI as we know it today. In its latest quarter, Nvidia's data center revenue increased 56% from a year ago to $41.1 billion (88% of its total revenue).

Nvidia makes GPUs for gaming consoles, automotive applications, and networking, but data centers are its bread and butter. The company plans to go all in on becoming an AI infrastructure company.

This pivot has worked out in Nvidia's favor and is expected to continue doing so, as the company anticipates AI infrastructure spending to increase between $3 trillion and $4 trillion over the next five years from some of AI's largest spenders, including the "Magnificent Seven" stocks. Nvidia expects it can capture up to 70% of this spending.

What Palantir has going for it

Palantir is a software company that uses AI to turn vast amounts of data into actionable insights. It's not as important to the AI ecosystem as Nvidia, but its use cases are continuously growing, which has fueled its growth over the past couple of years. Palantir's initial focus was on government entities, such as the Department of Defense, CIA, and FBI, but it has expanded and shown it can be successful in the commercial sector, too.

Its U.S. government segment is still the bulk of its revenue (42% of total revenue), but its U.S. commercial segment is its fastest-growing segment. In the second quarter, U.S. commercial revenue grew 93% year over year to $306 million. The growth of both segments helped Palantir achieve its first billion-dollar quarter, more than doubling its revenue from just three years ago.

PLTR Revenue (Quarterly) data by YCharts

Palantir's AI Platform (AIP) is responsible for its recent commercial success. As it continues to gain adoption across various industries, Palantir should see its revenue base diversify, enhancing its long-term appeal.

What downsides does each company have?

Nvidia's largest "roadblock" is that it's in the middle of a volatile relationship between the U.S. and China. The Trump administration imposed a ban on sales of the H20 chip (Nvidia's China-compliant AI chip) to China in April, but reversed the decision in July after Nvidia agreed to pay the government a 15% tax on AI chip revenue generated in China (the deal is in place, but has not yet been finalized). It's worth keeping an eye on how this plays out.

Palantir's downside is its reliance on U.S. government contracts. These contracts can provide lucrative opportunities, but they can also be subject to changing government budgets and political priorities. As volatile as the current political environment is, it wouldn't be far-fetched for some of these contracts to be restructured or canceled completely. Palantir's commercial business is growing, but it still relies on U.S. government contracts to keep the lights on.

You can't ignore how each company is valued

Although both companies have great growth prospects, you can't decide on which is the better one to own without looking at their valuations. As of Aug. 28, Nvidia is trading at 41 times its forward earnings, while Palantir is trading at 242 times its forward earnings.

NVDA PE Ratio (Forward) data by YCharts

Nvidia's 41 forward P/E ratio is expensive by most standards, but Palantir's valuation is one of the highest in history. It has gotten to the point where an Economist article mentioned that Palantir "might be the most overvalued firm of all time."

When I think of which is the better stock to own, I think about which one has more margin for error because growth stocks are known for being volatile -- especially ones propped up by AI hype. Nvidia has little room for error with its valuation, but Palantir has virtually no room for error at its current valuation.

In my opinion, that makes Nvidia the better choice between the two.

Should you invest $1,000 in Nvidia right now?

Before you buy stock in Nvidia, consider this:

*Stock Advisor returns as of August 25, 2025

Stefon Walters has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Nvidia and Palantir Technologies. The Motley Fool has a disclosure policy.

Nvidia vs. Palantir: The Better Growth Stock to Own Today was originally published by The Motley Fool

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The Ultimate Growth Stock to Buy With $1,000 Right Now

Motley Fool

Key Points

In general, you can divide the market into two camps -- value stocks and growth stocks.

Value stocks represent companies that are trading at an attractive valuation, such as price-to-earnings ratio or price-to-sales ratio. These companies are typically stable, mature and often provide a dividend. In fact, if you want to see some strong value stocks, check out Warren Buffett's moves.

Growth stocks, on the other hand, are big movers that are seeing outsized revenue or market share growth. These dynamic names in the market are often at the cutting edge of innovations -- so many of them are technology stocks -- and they also come with some volatility because the companies are scrambling to seize the moment. Their valuations tend to be poor, but investors are still buying because of their massive potential. Another trait of growth stocks is that their earnings may not be as strong as value stocks because they are pumping their profits back into the company -- either to fund research or to scale the business.

There are hundreds of growth stocks from which to choose, but if you're looking for the ultimate growth stock in the market, there's only one to consider, and that's Palantir Technologies (NASDAQ: PLTR).

Palantir's massive growth

Palantir started its incredible growth story two decades ago when it decided to take a new approach to automated approaches to technology -- customized systems that took too long to deploy, were too slow, and were unable to adapt. Palantir's approach was to create platforms that took into data from literally hundreds of sources at the same time, analyzed them and came up with actionable intelligence. It became a data mining company that developed software that turned incomprehensible material into something usable. The company's DNA is in the military and intelligence arena as it developed products that helped commanders position troops and find adversaries, including 9/11 mastermind Osama bin Laden in 2011.

But the company really took off when it developed its Artificial Intelligence Platform (AIP) in 2023 and began rolling it out through AIP bootcamps that demonstrated to customers how quickly they could access Palantir's massive database. AIP uses generative artificial intelligence and allows customers to start getting actionable insights from Palantir's massive databases in literally a matter of hours. Suddenly, a data mining company that was primarily known as a military or intelligence contractor was accessible to commercial businesses as well as other branches of government. CEO Alexander Karp wrote about the growth in a letter to shareholders on Aug. 4, 2025.

The growth rate of our business has accelerated radically, after years of investment on our part and derision by some. ... It has been a steep and upward climb -- an ascent that is a reflection of the remarkable confluence of the arrival of language models, the chips necessary to power them, and our software infrastructure, one that allows organizations to tether the power of artificial intelligence to objects and relationships in the real world.

Palantir by the numbers

When you think about ultimate growth stocks, Palantir's second quarter comes to mind. Revenue grew 48% from a year ago as the company topped $1 billion in quarterly sales for the first time. Its U.S. government revenue was up 53% to $426 million, and its U.S. commercial revenue was up 93% to $306 million.

Incredibly, Palantir closed 157 deals with values of at least $1 million in the second quarter, with 66 deals valued at $5 million-plus and 42 deals valued at $10 million-plus. The company's customer count is growing rapidly, rising from 593 in the second quarter of 2024 to 849 by the second quarter of 2025.

In addition, the company's operating income continues to grow at an accelerated rate.

Quarter	Adjusted Operating Income	Margin
Q2 2024	$254 million	37%
Q3 2024	$276 million	38%
Q4 2024	$373 million	45%
Q1 2025	$391 million	44%
Q2 2025	$464 million	46%

Source: Palantir Q2 2025 Investor Presentation

If there's anything to give investors pause, it's the company's valuation. Trading at a forward price-to-earnings ratio of 243 and a forward price-to-sales ratio of nearly 90, future earnings are already baked into Palantir stock and some analysts, such as JPMorgan's Dubravko Lakos-Bujas, say the stock is "overcrowded" and runs the risk of sinking in the second half. And objectively, the ratios are screaming red flags when you look at some other blue-chip growth stocks.

PLTR PE Ratio (Forward) data by YCharts

I agree the valuation is hard to stomach. But also, it's to be expected for a stock that was the best-performing S&P 500 stock in 2024 and is vying to repeat that number this year. Palantir is revolutionizing how businesses and companies operate and there's no other company that can do what it offers.

If you're investing in Palantir, you have to be willing to accept some risk and volatility. But as it continues to gain more customers, increases its revenue, and becomes a key partner for hundreds of businesses, Palantir is unquestionably the ultimate growth stock for 2025.

Should you buy stock in Palantir Technologies right now?

Before you buy stock in Palantir Technologies, consider this:

*Stock Advisor returns as of August 25, 2025

Patrick Sanders has positions in Nvidia and Palantir Technologies. The Motley Fool has positions in and recommends Apple, Microsoft, Nvidia, and Palantir Technologies. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.

The Ultimate Growth Stock to Buy With $1,000 Right Now was originally published by The Motley Fool

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If You'd Invested $10,000 in Palantir Stock 3 Years Ago, Here's How Much You'd Have Today

Motley Fool

Key Points

For the past three years, no other topic has taken over the technology and business worlds quite like artificial intelligence (AI). Although AI has been around for a while, recent advances and the public availability of generative AI tools like ChatGPT have brought it to the mainstream.

Many companies have seen their stock prices surge along with the interest in this technology, but Palantir (NASDAQ: PLTR) has emerged as one of the biggest beneficiaries of this tailwind. Had you invested $10,000 in Palantir stock three years ago (using Aug. 26, 2022, as the start date), your investment would be worth over $202,500 as of the market close on Aug. 26.

Why has Palantir stock surged so much recently?

Aside from the broader AI-fueled hype that has boosted tech stocks, investors have largely gravitated to Palantir because of the success of its Artificial Intelligence Platform (AIP). Historically, Palantir's software catered to U.S. military and intelligence agencies, but the release of AIP has quickly expanded its reach with commercial clients as well.

In the second quarter, Palantir reported its first billion-dollar-revenue quarter, and its U.S. commercial business was the fastest-growing segment. U.S. government revenue still accounted for the largest piece of the top line (42%), but U.S. commercial revenue grew 93% year over year to $306 million.

While the company continues to wow investors with each passing quarter, its skyrocketing share price has made it the most expensive large-cap stock in the S&P 500, on both a price-to-sales and price-to-earnings basis. At these levels, investors should think twice before putting a lump sum into the stock to chase the current momentum. However, if you're a long-term investor who can handle the volatility around Palantir, dollar-cost averaging can be a solid approach to take.

Should you buy stock in Palantir Technologies right now?

Before you buy stock in Palantir Technologies, consider this:

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $659,823!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,113,120!*

Now, it’s worth noting Stock Advisor’s total average return is 1,068% — a market-crushing outperformance compared to 185% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

*Stock Advisor returns as of August 25, 2025

Stefon Walters has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Palantir Technologies. The Motley Fool has a disclosure policy.

If You'd Invested $10,000 in Palantir Stock 3 Years Ago, Here's How Much You'd Have Today was originally published by The Motley Fool

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CEO Alex Karp Just Sold More Than $60 Million in Palantir Stock. Should Investors Follow Suit?

Motley Fool

Key Points

The past couple of years have been a whirlwind for Palantir (NASDAQ: PLTR) investors. The company had been working on advanced algorithms in relative obscurity for nearly 20 years before the dawn of artificial intelligence (AI) in late 2022. Under the leadership of CEO Alex Karp, Palantir used its decades of experience in the field to develop the company's Artificial Intelligence Platform (AIP). The AIP uses generative AI to collect data from a variety of disparate software systems and aggregates the information under a single dashboard, helping business leaders make data-driven decisions in real time.

Demand has been off the charts, helping propel Palantir stock to new heights. Since early 2023, Palatir's stock has gone parabolic, soaring an eye-popping 2,350% as of this writing. That meteoric rise has caused a commensurate increase in the stock's valuation, causing some retail investors and Wall Street veterans alike to avoid the stock.

If that weren't enough, Karp just sold millions of Palantir shares, making some shareholders justifiably nervous. If the chief executive is selling shares, is it time for investors to follow suit?

Let's see what the evidence suggests.

What's driving the stock higher

Before we dig into the numbers, it's worth looking at what's driving the stock price into the stratosphere -- and the most recent quarter is a good place to start.

In the second quarter, Palantir delivered revenue that jumped 48% year-over-year to $1 billion -- the first time the company has surpassed this threshold. This resulted in adjusted earnings per share (EPS) of $0.16, which soared 78%. This marked the eighth consecutive quarter of accelerating revenue growth.

The biggest contributor was the company's U.S. commercial segment (including AIP), which generated revenue of $306 million, an increase of 93% year over year and 20% quarter over quarter.

With results of that magnitude and the enormous potential represented by the ongoing AI adoption, its easy to see why the stock has been firmly in rally mode.

By the numbers

In a regulatory filing with the Securities and Exchange Commission (SEC), Palantir provided details regarding the stock sale. Karp sold a total of 409,072 shares, in a range of $142.46 to $157.56. In all, the total amount of the sale was more than $60 million. A sale of that magnitude might make investors a bit wary, particularly because it was the CEO making the sale. It might be easy to conclude that the chief executive knows something we don't, but that simply isn't the case. Digging a little deeper into the filing helps to provide some important context.

As part of Karp's compensation package, he receives restricted stock awards (RSAs) of Class B stock that vest over a period of years. Class B stock has 10 times the voting power of Class A stock and is restricted to founders and certain insiders and is a way to reward long-term performance and to align Karp's interests with those of Palantir shareholders.

On August 20, Karp was awarded the rights to 975,000 shares of Class B stock -- and the taxman was waiting with his hand out. Since Class B shares can't be sold on the open market (it's restricted), he immediately converted 222,878 shares to Class A shares, which were then sold on the open market to pay the required withholding tax obligations.

It's also important to note that following the $60 million sale, Karp still owned more than 6.43 million shares of Palantir stock, which were collectively worth more than $1 billion (at the time of this writing).

The old adage

Given Karp's sizable sale of Palantir stock, should investors follow suit? There's an old saying on Wall Street that there are lots of reasons to sell a stock but only one reason to buy. In this case, the reason for selling was to settle up with Uncle Sam and pay the required withholding tax on his just-awarded stock compensation.

However, given that Karp still holds personal Palantir shares worth roughly $1 billion, I don't view the sale as anything more than a financial management decision.

In a more general sense, the answer to that question of whether or not to sell will vary from investor to investor, and there's no single answer that fits all situations.

Some investors would argue that Palantir's valuation is stretched, which is a reasonable concern. The stock is currently selling for 184 times next year's earnings, making it among the most expensive stocks on the market.

Furthermore, given the stock's meteoric rise, Palantir may represent an overly large portion of an investor's individual portfolio. For example, $10,000 invested on Jan. 2, 2023, would be worth more than $244,740 (as of this writing) and may dwarf an investor's other holdings.

As a general rule, I would never sell a stock simply because a member of the management team is selling -- particularly if the reason is in black and white.

Should you buy stock in Palantir Technologies right now?

Before you buy stock in Palantir Technologies, consider this:

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $656,895!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,102,148!*

Now, it’s worth noting Stock Advisor’s total average return is 1,062% — a market-crushing outperformance compared to 184% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

*Stock Advisor returns as of August 25, 2025

Danny Vena has positions in Palantir Technologies. The Motley Fool has positions in and recommends Palantir Technologies. The Motley Fool has a disclosure policy.

CEO Alex Karp Just Sold More Than $60 Million in Palantir Stock. Should Investors Follow Suit? was originally published by The Motley Fool

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CEO Alex Karp Just Sold Over $60M in Palantir Stock. Here’s Why It’s a Distraction.

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