Palantir, AppLovin Fuel a 'Can't-Lose' Market. That's Dangerous for All Stocks
Sunday, Dec 15, 2024 2:34 pm ET
3min read 
Palantir Technologies (PLTR) and AppLovin (APP) have been on a tear, with Palantir up over 1,000% and AppLovin up over 500% since their IPOs. But this 'can't-lose' market is dangerous for all stocks. Here's why:
Firstly, these stocks are trading at extremely high valuations. Palantir's price-to-earnings ratio is over 100, and AppLovin's is over 50. This means investors are paying a lot for each dollar of earnings, which can lead to a crash if earnings don't meet expectations.
Secondly, these stocks are heavily shorted. Palantir has a short interest of over 50%, and AppLovin has over 30%. This means many investors are betting against these stocks, which can lead to a short squeeze if the stocks continue to rise.
Thirdly, these stocks are driven by hype and speculation. Palantir and AppLovin are not traditional companies with established business models. They are both tech startups with unproven business models, and their stocks are driven by hype and speculation rather than fundamentals.
In conclusion, while Palantir and AppLovin may continue to rise in the short term, the 'can't-lose' market is dangerous for all stocks. Investors should be cautious and consider the risks before investing in these high-flying tech stocks.
Palantir and AppLovin have been on a tear, with Palantir up over 1,000% and AppLovin up over 500% since their IPOs. But this 'can't-lose' market is dangerous for all stocks. Here's why:
Firstly, these stocks are trading at extremely high valuations. Palantir's price-to-earnings ratio is over 100, and AppLovin's is over 50. This means investors are paying a lot for each dollar of earnings, which can lead to a crash if earnings don't meet expectations.
Secondly, these stocks are heavily shorted. Palantir has a short interest of over 50%, and AppLovin has over 30%. This means many investors are betting against these stocks, which can lead to a short squeeze if the stocks continue to rise.
Thirdly, these stocks are driven by hype and speculation. Palantir and AppLovin are not traditional companies with established business models. They are both tech startups with unproven business models, and their stocks are driven by hype and speculation rather than fundamentals.
In conclusion, while Palantir and AppLovin may continue to rise in the short term, the 'can't-lose' market is dangerous for all stocks. Investors should be cautious and consider the risks before investing in these high-flying tech stocks.
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