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Cathie Wood Just Issued a Rare BUY Signal in Palantir (PLTR) Stock


  • Cathie Wood just made another bet on Palantir Technologies (PLTR).
  • The contrarian investor isn’t known for doubling down on strong companies.
  • But since Palantir reported strong earnings, PLTR stock has been climbing.
PLTR stock - Cathie Wood Just Issued a Rare BUY Signal in Palantir (PLTR) Stock

Source: Poetra.RH / Shutterstock.com

One of the market’s most famed contrarian investors just made an out-of-character movie. Cathie Wood is known for buying up beaten-down tech stocks, typically after a negative catalyst pushes them down significantly. Offloading large chunks of shares is par for the course for her funds. However, redoubling on a company shortly after selling is much less common. And Wood recently purchased over four million shares of Palantir Technologies (NYSE:PLTR) stock, a company that hasn’t exactly been struggling lately.

On the contrary, PLTR stock has surged over the past month and just reported impressive Q1 earnings. Wood’s new investment should be seen as a rare endorsement for the big data analytics company and shouldn’t be ignored.

After almost two weeks of growth, PLTR stock is back in the red today. As of this writing, it is down 0.5% for the day. While it has been highly volatile so far, its current trajectory hints that a rebound is possible. That said, it has soared more than 33% over the past week after beating analysts’ expectations for both revenue and earnings-per-share (EPS) in its Q1 earnings report. Additionally, the company is redoubling its focus on artificial intelligence (AI), making its bullish case even stronger.

Wood Doubles Down on PLTR Stock

Clearly, Wood agrees with the experts who see it as a buy. Benzinga reports that she recently purchased 4.37 million shares of PLTR stock, spread between her flagship ARK Innovation ETF (NYSEARCA:ARKK) and ARK Next Generation Internet ETF (NYSEARCA:ARKW). The investment is worth roughly $43 million. The outlet also notes that Wood’s fund made a swift exit from its Palantir position less than two months ago, offloading more than 30 million shares in less than a month. This is the type of 180 that we don’t often see. It seems that Wood realized quickly that her decision to sell off her entire PLTR stock holdings might have been premature.

Indeed, the company struggled late in 2022 as the bear market raged on. However, since the new year, it has been gradually trending upward. PLTR stock is up more than 54% year-to-date (YTD), showing a highly encouraging growth pattern. Now it is better positioned than ever to keep climbing as the AI boom expands. As CEO Alex Karp noted in a letter to shareholders:

“And we now anticipate that we will remain profitable each quarter through the end of the year. In addition, for the first time in our history, we earned an operating profit last quarter. We generated $525 million in revenue in the first quarter, a result that surpassed our initial guidance and yet still understates the magnitude of the opportunity in front of us.”

Anyone who follows Wood knows that her classic modus operandi is to buy tech stocks at their lowest points. This week, she did the opposite, making a largescale purchase of a company with significant growth potential. This means that she sees it as having much further to rise, which should be highly encouraging to investors. While the stock is falling today, it is in an excellent position to emerge as one of the year’s breakout sensations. If Wood wants to buy it on the heels of good news, other investors will likely do the same.

On the date of publication, Samuel O’Brient did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Samuel O’Brient has been covering financial markets and analyzing economic policy for three-plus years. His areas of expertise involve electric vehicle (EV) stocks, green energy and NFTs. O’Brient loves helping everyone understand the complexities of economics. He is ranked in the top 15% of stock pickers on TipRanks.

Article printed from InvestorPlace Media, https://investorplace.com/2023/05/cathie-wood-just-issued-a-rare-buy-signal-in-palantir-pltr-stock/.

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