Palantir Technologies Stock Tumbled 23% – Opportunity or Trap?
Palantir Technologies (PLTR) stock has fallen by 23.2% in less than a month, from $181.68 on 7th Jan, 2026 to $139.54 now. Should you buy this dip?
Dip buying is a viable strategy for quality stocks that have a history of recovering from dips. As it turns out, PLTR stock passes basic quality checks. But the bad news is that historically, the median return for the 12-month period following sharp dips was -7.4%, with median peak return of 41%. We define sharp dip as stock going down 30% or more, in less than 30 day period.
Below, we get into details of historical dips and subsequent returns.
Historical Median Returns Post Dips
| Period | Past Median Return |
|---|---|
| 1M | 3.8% |
| 3M | 3.5% |
| 6M | -0.7% |
| 12M | -7.4% |
Historical Dip-Wise Details
PLTR had 6 events since 1/1/2010 where the dip threshold of -30% within 30 days was triggered
- 41% median peak return within 1 year of dip event
- 144 days is the median time to peak return after a dip event
- -38% median max drawdown within 1 year of dip event
| 30 Day Dip | PLTR Subsequent Performance | |||||||
|---|---|---|---|---|---|---|---|---|
| Date | PLTR | SPY | 1Y | Peak Return |
Max Drop |
# Days to Peak |
||
| Median | -7% | 41% | -38% | 144 | ||||
| 4012025 | -32% | -8% | 86% | 145% | -13% | 216 | ||
| 9142022 | -30% | -3% | 101% | 162% | -21% | 321 | ||
| 5092022 | -42% | -12% | 33% | 53% | -20% | 88 | ||
| 1212022 | -32% | -6% | -48% | 8% | -56% | 73 | ||
| 12202021 | -31% | -3% | -65% | 5% | -65% | 7 | ||
| 3082021 | -31% | -0% | -51% | 28% | -54% | 199 | ||
Palantir Technologies Passes Basic Financial Quality Checks
Revenue growth, profitability, cash flow, and balance sheet strength need to be evaluated to reduce the risk of a dip being the sign of a deteriorating business situation.
| Quality Metrics | Value | Quality Check |
|---|---|---|
| Revenue Growth (LTM) | 47.2% | Pass |
| Revenue Growth (3-Yr Avg) | 29.3% | Pass |
| Operating Cash Flow Margin (LTM) | 46.6% | Pass |
Not sure if you can take a call on PLTR stock? Consider portfolio approach
Portfolios Are The Smarter Way To Invest
Individual picks can be volatile but staying invested is what matters. A diversified portfolio helps you invest, capture upside and reduce downside
The Trefis High Quality (HQ) Portfolio, with a collection of 30 stocks, has a track record of comfortably outperforming its benchmark that includes all 3 – the S&P 500, S&P mid-cap, and Russell 2000 indices. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride, as evident in HQ Portfolio performance metrics.