In 2025, Palantir Technologies (PLTR 0.33%) shares have added 145% and Intel (INTC +0.40%) shares have added 88%. But certain Wall Street analysts expect the stocks to fall sharply in 2026, as detailed below:
- Rishi Jaluria at RBC Capital has set Palantir Technologies with a target price of $50 per share. That implies 72% downside from its current share price of $183. Meanwhile, Brent Thill at Jefferies has set his target price at $70 per share. That implies 61% downside.
- Joseph Moore at Morgan Stanley has set Intel with a bear-case target price of $19 per share. That implies 50% downside from its current share price of $38. Meanwhile, Matt Bryson at Wedbush has set his target price at $20 per share. That implies 47% downside.
Here's what investors should know about Palantir and Intel.
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Palantir Technologies: 72% downside implied by RBC Capital's target price
Palantir develops analytics and artificial intelligence (AI) software that helps clients in the public and private sectors manage and make sense of complex data. Forrester Research has recognized the company as a leader in AI platforms and AI decisioning software, and International Data Corporation (IDC) has ranked Palantir as a leader in decision intelligence software.
NASDAQ: PLTR
Key Data Points
Palantir's revenue growth has accelerated in nine straight quarters, and the company's guidance suggests that trend could continue in the next quarter. Keith Weiss at Morgan Stanley recently commented, "It's hard to find a better fundamental story in software than Palantir." But no company -- not even the most fundamentally sound company -- is worth buying at any price.
Palantir currently trades at 115 times sales, making it more than twice as expensive as the next closest stock in the S&P 500 (^GSPC 0.18%), which is AppLovin at 44 times sales. For context, Palantir could lose 60% of its value and still be the most expensive stock in the index. That premium is unsustainable. No software company has ever maintained a price-to-sales ratio above 100 indefinitely.
To be clear, Palantir shares may keep moving higher in the near term in the absence of bad news, but the stock would almost certainly crash if a sufficiently negative catalyst arises. Investors should either avoid Palantir or at least keep their positions very small. The risk-reward profile is heavily skewed toward risk.
Intel: 50% downside implied by Morgan Stanley's bear-case target price
Intel is the largest supplier of central processing units (CPUs) for personal computers and data center servers, meaning the company should theoretically be at the very center of the artificial intelligence boom. However, repeated missteps and manufacturing delays have left Intel behind competitors like TSMC in terms of process technology (i.e., chip manufacturing technology).
Meanwhile, AMD and Arm Holdings have built increasingly powerful chips using the most advanced process nodes. Also, several hyperscalers have adopted Arm processors because they can be built to custom specifications. In turn, AMD and Arm have won substantial market share at Intel's expense in personal computers and data center servers. For context, Intel's unit share has fallen more than 35% in both markets in the past decade.
NASDAQ: INTC
Key Data Points
In 2021, Intel launched its foundry business (i.e., contract chip manufacturing) as a means of capitalizing on rising demand for advanced semiconductors. The company initially set an ambitious goal of surpassing Samsung to become the second-largest foundry by 2030, but that seems wildly optimistic at this point. Intel reportedly has just one major customer for its fledgling foundry business.
Of course, bulls frequently claim Intel is on the cusp of a turnaround, but it's hard to justify that argument: Intel continues to cede market share, its foundry business has failed to win major customers, and sales actually dropped 23% in the last three years despite booming demand for AI processors. Also, Wall Street expects no sales growth in the next year.
Meanwhile, Intel trades at 2.7 times sales, a material premium to the three-year average of 2.2 times sales. That may have something to do with the U.S. government taking a stake in the company, but that doesn't actually fix the underlying problems.
I doubt shares will drop 50%, but the stock does not look attractive. I think investors should put their money elsewhere.
