Citron Research says Palantir stock at $40 per share would still be an expensive AI stock to own. Wall Street recommends caution on PLTR shares as well.

Short-seller Citron targets PLTR again, using a Databricks comparison to argue the stock is overvalued after its report sent shares falling.

AI software firm Palantir Technologies ($PLTR) has seen its stock drop for six straight sessions, wiping out $73 billion in market value.

Since Cramer’s post, Palantir has fallen −16%, recording five consecutive red daily candles, marking its steepest five-day decline since April 2025. On Tuesday alone, PLTR stock plunged −9.35% (−$16.28), closing at $158.34, and was seen trading pre-market at $156.80 (−0.60%) on Wednesday, August 20.

Palantir stock has been on a rough run, slipping for the fifth straight session and now sitting 12% below its recent all-time high. Despite reporting a blockbuster Q2 with stronger revenue and guidance,

Palantir stock slightly gapped down on Wednesday, easily skating beneath the 50-day Simple Moving Average (SMA). This tells us that the bottom is unlikely to be near. The July 1 pullback near $130 is a possible level to watch as it sits close to the 100-day SMA.

The Citron Research bearish call follows comments from OpenAI CEO Sam Altman, who described the AI market as a bubble.

Shares in Palantir fell as much as 9% in late trading on Tuesday amid a broad AI pullback and a critical short-seller report.