Shares of Palantir Technologies fell to $15.17 during today's morning trading session -- a decrease of -3.9% that still sees the stock 49.91% above its average analyst target price of $10.12. So there may be further downside for the Information Technology stock, which analysts rate as hold on average. Current target prices range from $5.0 to 18.0 dollars per share.
To understand the market's outlook on the stock, we can look at Palantir Technologies's short interest: the proportion of the share float that is tied to short positions. Behind each short position is an investor who believes that the stock will decline in the future. Here, the stock's short interest is 8.0% which means the outlook is split.
Short selling involves borrowing shares and then selling them at current market prices. In the successful version of the strategy, the shares are purchased at a lower price at some time in the future. The investor then returns the shares to the lender, and keeps the profit made on the sell/buy transaction.
We can make inferences about the market sentiment surrounding Palantir Technologies by analyzing its rate of institutional ownership. If institutions such as hedge funds and pension funds are the primary shareholders of a corporation, it most likely means that its shares are a good investment according to those institutions' analysts.
At 34.7%, the rate of institutional ownership is average, indicating that a sufficient number of institutions have concluded that it is a stable investment. Beware, however, that the rate of institutional ownership could also indicate an ongoing proxy battle or takeover attempt -- so you should also periodically check the news about a stock whose institutional ownership you are tracking.
Overall, there is mixed market sentiment towards Palantir Technologies because of an analyst belief that shares are overpriced, a hold rating, an above average percentage of its shares sold short, and only a small number of institutional investors. Investors should not base their decisions on market sentiment only, they should also be aware of a stock's fundamentals before committing.
At a glance, here are some essential statistics you may want to know about PLTR:
It has trailing 12 month earnings per share (EPS) of $-0.12 per share
Palantir Technologies has a trailing 12 month Price to Earnings (P/E) ratio of -126.4 while the S&P 500 average is 15.97
The company has a Price to Book (P/B) ratio of 11.8 in contrast to the S&P 500's average ratio of 2.95
Palantir Technologies is a Technology company, and the sector average P/E and P/B ratios are 27.16 and 6.23 respectively