Down 25% from its Peak, Is Palantir Stock Undervalued?

Shares of Palantir Technologies (PLTR) have declined by about 25% from their peak of $125.41. The decline comes after an impressive rally over the past year, which pushed the company’s valuation to elevated levels. Besides valuation concerns, a new challenge has emerged, adding pressure to the stock.

According to a report from The Wall Street Journal, the U.S. government plans to cut its defense budget over the next five years. This news is particularly significant for Palantir, as government contracts have long been a key driver of its revenue. If military spending tightens, the company could face obstacles in sustaining its growth momentum.