This article first appeared on our U.S. website.

After posting incredible returns in 2023 and 2024, Palantir (NASDAQ: PLTR) stochas had another strong year. It’s up 150% so far in 2025, and knocking on the door of all-time highs again.

While investors might feel like they’ve missed out on one of the biggest winners of the artificial intelligence (AI) investment trend, Palantir’s growth rate has been steadily rising, and there’s a lot more business it can capture, which could lead to a higher stock price.

We’ll get an update from Palantir on Nov. 3 about its Q3 results, which could send shares soaring again if it announces growth that exceeds expectations. So, should you scoop up shares before this announcement?

Palantir’s platform is seeing monster growth from commercial and government clients alike

Palantir started off as an AI data analytics program for government use only. Those early contracts helped build and shape Palantir into the business it is today. Eventually, the company figured out there was a commercial use case for its product lineup as well, so Palantir expanded to capture that audience, too. Both segments contributed to strong growth at times, but each is growing rapidly, thanks to the massive AI buildout that’s ongoing.

In Q2, Palantir’s commercial revenue rose 47% year over year to US$451 million. Government revenue rose 49% year over year to US$553 million. So, not only is Palantir’s government division still the largest by revenue, it also has a slightly faster growth rate. Combined, they delivered 48% growth to US$1 billion, allowing Palantir to surpass the US$1 billion quarterly revenue mark for the first time. 

Unlike many growing software companies, Palantir emphasized becoming profitable. During Q2, Palantir’s profit margin totaled 33%, a level most software companies target.

This is clearly the sign of a growing and dominant business, and it’s hard to find fault with any of Palantir’s results. Management has a strong track record of outperforming expectations it lays out, so another earnings beat seems likely on Nov. 3. A beat could send the stock up, making it a no-brainer buy today.

However, growth isn’t everything in an investment, and there’s one massive red flag that investors cannot ignore.

Palantir’s valuation is unbelievable

Even the best companies bought at the wrong price can turn out to be terrible investments. Palantir has an incredibly high valuation that few companies have ever reached, especially with Palantir’s relatively “slow” growth rate compared with companies that have reached these sky-high levels.

Palantir’s stock trades for 132 times sales and 213 times 2026 earnings.

PLTR PS Ratio data by YCharts

Those valuation metrics are hard to believe, especially for a company with Palantir’s growth rates. Companies that achieve a 100 times sales or greater valuation are rare, but when you find them, they’re typically doubling or tripling their revenue year over year for multiple quarters.

While Palantir’s revenue growth is very strong, it’s nowhere near the rate that some of its peers that traded for 100 times sales or more have achieved. This makes the stock incredibly risky because as soon as growth shows signs of weakness, the stock price will come tumbling down. This hasn’t happened yet, so investors have continued to drive up the stock price of an incredible business that has just uncoupled from its stock.

If I’m a Palantir shareholder, I’m taking some of the monster gains I’ve achieved and moving that money into a different investment. While Palantir will likely be a successful company and build out its AI platform across government and commercial clients, there are multiple years’ worth of growth already priced into Palantir’s stock. This concerns me, I think and investors should stay away from this one until after Q3 results are released; then we’ll see how the growth rate is doing and make another assessment.

The post Should You Buy Palantir Stock Before Earnings on Nov. 3? appeared first on The Motley Fool Canada.

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Fool contributor Keithen Drury has no position in any of the stocks mentioned. The Motley Fool recommends Palantir Technologies. The Motley Fool has a disclosure policy.

Nvidia‘s (NASDAQ: NVDA) stock hasn’t gone on sale often, but when it has dipped slightly since 2023, it has been a no-brainer buying opportunity for investors. While investors may have missed the bottom of the dip when it was down around 25%, is a 10% discount still a good enough price to pay?

Nvidia stock is down 10% from its all-time high set in June. If you’re considering Nvidia stock now, are you buying it for a 10% return or looking for something even bigger?

Next quarter appears to be another strong one for Nvidia

Nvidia has been the talk of the investing world for nearly two years. Its graphics processing units (GPUs) are used by those who want top-tier computing performance. These GPUs have been used almost exclusively by some of the world’s largest artificial intelligence (AI) researchers, which has caused Nvidia’s business to boom.

Demand for its GPUs continues to pick up. In Q2 FY 2023 (ending July 31, 2022), Nvidia’s revenue was $6.7 billion. In Q2 FY 2024 (ending July 30, 2023), it was $13.5 billion. Most recently, in Q2 FY 2025 (ending July 28), it was $30 billion. It’s rare for a company to more than quadruple its revenue in just two years, let alone one doing it at Nvidia’s size. However, its run is expected to continue, as management has guided for revenue of $32.5 billion in Q3.

Clearly, the demand for Nvidia’s GPU hasn’t been satisfied, so buying the dip here looks smart, at least in the short term.

Nvidia’s earnings projections look attainable

Looking forward through the next year, we can use Nvidia’s forward price-to-earnings (P/E) ratio and compare that to its trailing P/E to understand what kind of growth Wall Street has already baked into the stock.

NVDA PE Ratio data by YCharts

At 56 times trailing earnings and 42 times forward earnings, Nvidia needs to achieve 33% earnings growth over the next year to achieve that valuation. If you look at Q2’s earnings per share growth of 168%, you’re probably inclined to think that will be an easy task. But there’s more to that story.

Nvidia’s margins significantly expanded as demand for its GPUs rose.

NVDA Gross Profit Margin (Quarterly) data by YCharts

Starting in Q3, we will directly compare Nvidia’s high profit margins against each other year over year, so Nvidia’s profit growth will still be impressive, but not in the 100%-plus year-over-year range.

As a result, its earnings growth will be more closely tied to revenue growth, but with 80% growth expected, it’s still going to be very impressive.

So with earnings growth of around 80% expected in Q3, I’d say Nvidia is also on track for the medium term.

Long-term demand for GPUs will remain elevated

Last comes the hardest part of the projection, the long term. If you believe that AI growth will continue, you’re already expecting artificial intelligence to play a large role in our daily lives. The question is how much computing power it will require.

Once the big AI developers build out enough computing power to process all the AI training they want, Nvidia’s sales will likely suffer greatly. But when this will happen is anyone’s guess. It could be decades away or right around the corner. With the beginning stages of AI deployment and training just occurring, I’d guess it will be some time before Nvidia struggles.

With Nvidia checking all three boxes from a timing perspective, I think investors can confidently buy the dip in Nvidia’s stock here.

The post Nvidia Stock Is Down 10% From Its Highs. Is It Time to Buy the Dip? appeared first on The Motley Fool Canada.

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Fool contributor Keithen Drury has no position in any of the stocks mentioned. The Motley Fool recommends Nvidia. The Motley Fool has a disclosure policy.