Palantir Technologies just posted its worst monthly stock performance in five years. Shares hit a 52-week intraday low of $106.37 on June 25, closing the session around $108.58 after dropping 4.3% in a single day. For the month of June, the stock has fallen approximately 25%. Year-to-date, Palantir is down roughly 34-36%.

The valuation reckoning

The broader market has been rotating away from software stocks, and Palantir, which rode an extraordinary rally through much of 2025, became an obvious target.

Wolfe Research resumed coverage of Palantir on June 16 with a “Neutral” rating. The firm acknowledged that Palantir holds what it called the best AI product-market fit in the space.

Michael Burry’s bet against Palantir

Michael Burry, the investor made famous by “The Big Short” for correctly predicting the 2008 housing crisis, has held long-dated put options on Palantir since the fall of 2025, effectively betting the stock would decline. He has reaffirmed those bearish views in 2026, pointing to increased competition from companies like Anthropic in the enterprise AI sector.

What this means for investors

Palantir’s platforms like AIP (Artificial Intelligence Platform) have been genuinely adopted by government and enterprise clients for mission-critical workflows. The company’s deep ties to defense and intelligence agencies provide a moat that no chatbot startup is going to breach overnight. On the other hand, the commercial side of the business faces legitimate questions about whether enterprises will continue paying premium prices when increasingly capable AI tools are available from competitors.

The 34-36% year-to-date decline puts Palantir in a very different position than where it started 2026. A “Neutral” rating from Wolfe Research during a 25% monthly drawdown, combined with an acknowledgment of best-in-class product-market fit, suggests the analyst community sees value somewhere below the 2025 highs but isn’t confident the bleeding has stopped.