1. Valuation Concerns: Morgan Stanley’s downgrade highlights a critical issue—Palantir’s valuation premium. Currently, it trades significantly higher than its peers, which limits the upside potential unless we see substantial growth acceleration or new revenue streams.

2. AI Hype vs. Execution: The AI narrative has undoubtedly fueled its stock price, but much of this growth feels priced in. For me, I’d need to see clearer evidence of sustained profitability, client diversification, and product scalability to justify its current valuation.

3. Macro Trends: The broader market is also a factor. With increasing interest rates and the potential for economic headwinds, high-growth tech stocks like PLTR might face further pressure. A more attractive entry point could arise in a market correction.

After seeing strong gains, I’m cautious about re-entering unless there’s a significant mispricing opportunity. While I believe in Palantir’s long-term potential, I’d prefer a margin of safety before committing new capital. For me, a price closer to $40 or below would warrant a re-evaluation.