Citron Research Reinforces $40 Per Share Target for Palantir, Utilizes Databricks for Analysis

This article does not constitute investment advice. The author currently does not hold positions in any of the stocks mentioned.

Citron Research Doubles Down on Bearish Stance Against Palantir

Andrew Left, the founder of Citron Research, has intensified his criticism of Palantir Technologies, demonstrating a focused and disciplined approach that’s become his hallmark. Recently, he reaffirmed his controversial $40 per share price target for this well-known tech stock.

In a recent interview on Fox Business, Left announced he had shorted Palantir’s stock, signaling his bearish outlook post the company’s latest quarterly earnings report. He described his negative perspective on Palantir as “obvious, ”reflecting his unwavering conviction.

Using OpenAI as a Benchmark

Earlier this week, Left reiterated his bearish stance, pegging Palantir’s price target based on metrics from industry peers. Specifically, he referenced OpenAI’s price-to-sales ratio of approximately 17x to justify his decreased valuation for Palantir.

As a brief overview, OpenAI is projected to achieve a valuation close to $500 billion with anticipated sales of $29.6 billion by 2026. This results in a compelling price-to-sales multiple of 16.89x. By applying this 17x metric to Palantir’s estimated 2026 revenue of $5.6 billion, Citron Research derived a theoretical valuation of approximately $95.2 billion, leading to the now widely known $40 per share target.

$PLTR Palantir – All Roads Lead to $40. This Time, Databricks. Congratulations to Databricks, one of America’s truly great growth companies, now valued at $100 billion in the private markets. No other company resembles Palantir more closely in product offering and enterprise… pic.twitter.com/M8Vvp7ixkd

— Citron Research (@CitronResearch) August 20, 2025

Comparative Analysis with Databricks

Citron Research highlights a striking resemblance between Palantir and Databricks based on several critical performance indicators. Both companies exhibit nearly identical annual revenues and gross margins; however, Databricks boasts a superior net revenue retention rate.

Using Databricks’ $100 billion valuation as a model, Citron Research once again arrives at the contentious $40 per share price target for Palantir.

Looks like the #MIT report on 95% of Gen #AI pilots failing might be rattling the markets. Trillion+ $ of capex needs an ROI. Or else as I said a year ago. The largest mis-allocation of capital.https://t.co/wLHw8NfYTn

— Mojo (@Mojo_flyin) August 20, 2025

Market Reaction and Overall Context

Currently, Palantir’s stock has experienced a 16% decline over the past five trading days, with an additional drop of 2% noted in pre-market trading today. Citron Research’s timing in entering a short position against Palantir may be fortuitous, especially following a recent MIT study that revealed 95% of generative AI projects are failing to deliver any return on investment (ROI).For a detailed analysis, access the MIT report here.

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