From Nasdaq:



Palantir Technologies’ stock (NYSE: PLTR) has seen a 175% increase in 2023 due to optimism about artificial intelligence (AI) companies and the company’s recent emergence from losses. However, there are significant risks potential investors should be aware of before buying the stock. One risk is the company’s significant revenue concentration, with 56% of its 2022 revenue coming from the public sector. This concentration limits its ability to grow in the future. Additionally, Palantir has a high revenue concentration in its top three and top 20 customers, which could pose future problems if these contracts are not renewed. The company has been working to reduce its revenue concentration, but any diversification efforts will take years to materialize. Another major risk is that Palantir’s stock is priced for perfection, with high valuations compared to other companies in the industry. While the company’s prospects are good, buying the stock at such a high valuation provides no margin of safety, and any change in prospects or missed earnings could send the stock price down. Overall, while Palantir Technologies has potential, there are significant risks that potential investors should consider before buying the stock.



Original: 2 Major Risks Investors Should Know Before Buying Palantir’s Stock