The tech world is witnessing a significant shift in sentiment towards artificial intelligence (AI) stocks, with Palantir (PLTR) being a prime example. The company has been on fire for nearly two and a half years, but its valuation growth has become unsustainable. Meanwhile, another AI infrastructure company, Nebius Group (NBIS), is offering an attractive investment opportunity.
Palantir’s impressive quarterly earnings results have propelled the stock to new heights, but analysts are warning that the company’s valuation has grown too far, too fast. Jefferies analyst Brent Thill recently increased his price target from $28 to $60, but Palantir already trades at over $111, making it difficult to justify its current valuation.
In contrast, Nebius Group is an AI infrastructure company with a unique business model that offers AI-as-a-service. The company has received significant investment backing from Nvidia and boasts massive cash reserves. With plans to invest in European data centers and expand its operations in Finland, Nebius has plenty of room for growth.
While Palantir’s valuation may not be sustainable in the long run, investors should consider alternative opportunities like Nebius Group. This AI infrastructure company offers an attractive valuation and significant growth potential, making it a compelling investment choice.
Source: https://www.fool.com/investing/2025/02/13/pair-trade-fade-palantir-buy-this-ai-stock