Palantir Stock Split? More Like a Pig With Lipstick
Oh, look, another round of Wall Street geniuses hyperventilating about a potential stock split. This time it's Palantir. Because apparently, slicing a pizza into smaller pieces makes it taste better? Give me a break.
So, Palantir's stock has jumped 330% in the last year, and suddenly everyone's losing their minds about a potential split. An analyst from RBC Capital is fueling the fire, claiming "retail is largely focused on the potential for a stock split." No, retail investors are largely focused on getting rich quick, and they think stock splits are magic beans. Is Palantir Wall Street's Next Stock Split?
The "logic," if you can call it that, is that a lower price point attracts new investors. As if the price tag is the only thing holding back the hordes. Newsflash: if you weren't interested in Palantir at $200, you probably won't be suddenly mortgaging your house to buy it at $20.
The Stock Split Mirage
Let's be real: a stock split is just cosmetic surgery. It doesn't change the underlying value of the company one iota. The market cap remains the same. Your percentage of ownership remains the same. All that changes is the number of shares you own and the price per share. It's like rearranging the deck chairs on the Titanic.
But hey, maybe I'm missing something. After all, Chipotle, Nvidia, and Broadcom saw their stock prices soar after announcing splits last year. Except... Chipotle's growth has stagnated, and its stock is down nearly 30% since the split. So much for magic.
The real reason Nvidia and Broadcom kept soaring? They delivered. Actual, tangible results. Palantir is operating in the black, which is more than can be said for some of its competitors. And their bespoke AI approach seems to be working, landing them lucrative government contracts and sticky client relationships. Good for them.
The Elephant in the Room: Valuation
But here's the part everyone seems to be conveniently ignoring: Palantir's valuation is insane. A P/E ratio of over 620? Are you kidding me? They'd have to grow their earnings tenfold just to approach reasonable levels. Even then, they'd be trading at a P/E nearly twice that of Alphabet.
I get it, AI is the shiny new toy, and everyone wants a piece. But at some point, reality has to kick in. You can't just keep throwing money at a company based on hype and hope. Fundamentals still matter.
And honestly, this whole situation reminds me of my neighbor's cat, Mittens. She's a perfectly ordinary tabby, but he's convinced she's some kind of rare breed and treats her like royalty. He even bought her a diamond-studded collar. Some people just get carried away...offcourse, it's his cat and his money.
So, will Palantir split its stock? Maybe. Does it matter? Not really. Should you buy it? Absolutely not, unless you enjoy gambling with your retirement savings. I sure as hell won't be.
