Shares of Palantir rose about 20% the day President Trump was elected president. The stock hasn’t looked back, more than tripling since election day. Palantir has been a big winner under the Trump administration. This past weekend, the Washington Post highlighted some of the big government contract wins for Palantir as shown below:

• Federal Aviation Administration (FAA): Contract for unspecified services, part of at least $300 million in new and expanded deals.
• Centers for Disease Control and Prevention (CDC):
• Contract for unspecified services, included in the $300 million total.
• Fannie Mae: Contract for unspecified services, part of the $300 million in new contracts.
• Department of Homeland Security (DHS): $30 million contract to track immigration enforcement.
• State Department: Pilot program contract to use Palantir’s AI for drafting diplomatic cables.
• U.S. Army: $10 billion contract to consolidate software procurement over the next decade.
• Maven Smart System (U.S. Army): $795 million contract awarded earlier in 2025 for data processing and AI capabilities.

Palantir’s sales have been rising rapidly, in part due to the contracts listed above. However, its earnings have been lagging as they have been heavily investing in their capabilities. That said, EPS is expected to grow by nearly 100% over the next year. Given its limited earnings and soaring stock price, Palantir has a P/E of 700 and a forward P/E of 218. The question investors need to ask is whether the contracts listed above and future government and corporate contracts justify the lofty valuations.

Disclosure: RIA Advisors has a position in Palantir in its equity models.

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What To Watch Today

Earnings

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Economy
 

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Market Trading Update

Yesterday, we discussed that the market broke its 20-DMA on Friday as the seasonally weak month of the year started. Of course, retail traders stepped in to “buy the dip” on Monday, as the market reversed some of its previous overbought conditions. Given the underlying market momentum and bullish sentiment, the buying spurt yesterday is unsurprising. The key will be whether the market can close the gap from Friday’s close and reclaim the 20-DMA.

While we wait to see what the market does over the next few days, we launched the online account opening process at SimpleVisor. If you have been following our work for a while, you can invest directly into some of our portfolios. The online process will open an account for you at Pershing and walk you through a risk profile questionnaire, or you can select from several “thematic” portfolios we have put together for you.

Once that is complete, we take over the work from there and manage the portfolios in real time. As we trade for our clients, we will simultaneously execute the trades in your account.

Once the account is open and funded, you will have a “client portal” you can log into to view your account, holdings, and transactions.

We chose BNY Pershing, a subsidiary of BNY Mellon, as our custodian for these portfolios, as they are a leading global provider of financial business solutions, specializing in clearing, custody, and technology solutions for wealth management and institutional firms. They offer various services including clearing and custody, trading and settlement, advisory and investment solutions, data insights, and business consulting. BNY Pershing serves a diverse clientele, including broker-dealers, RIAs, wealth managers, and institutional firms, helping them to grow their businesses and optimize their operations. 

Furthermore, BNY Pershing provides several layers of protection for its clients’ assets, including SIPC coverage, excess of SIPC insurance, and robust internal controls. They also segregate client assets from their own to ensure they are readily available to clients. 
 

Utilities Chase Technology

The graph on the right side of the SimpleVisor absolute and relative scores shows how Utilities are moving up and to the right over the last few weeks. This is a function of its absolute and relative scores increasing. Its absolute score, at 0.88, is now very overbought. Bear in mind that it, along with many other sectors, was very overbought before Friday’s decline. However, unlike the S&P 500, which was down 2.5% last week and many sectors that followed it, utilities rose 1.5% on the week.

Conversely, technology, which has been leading the pack on a relative and absolute basis, has seen its level of overboughtness moderate significantly. While still slightly overbought, the sector is closing in on fair value using this analysis. Similarly, the broader market, as shown with stock factors in the second graphic, has also seen a sharp decline in absolute scores. We are a little surprised that the sector and factor absolute scores normalized as quickly as they did. The question now is, will this period of weakness bring the scores to oversold levels, or are they likely to sit around fair value before their next ascent toward overbought conditions?
 

Bull Streak Ends As August Begins

As the turn of the calendar occurred on Friday, the bull streak for the market since the April lows ended. Such was not unexpected, and the correction has been a topic of discussion in our DailyMarketCommentary over the last two weeks. To wit:

“While the overall backdrop remains bullish, including stable economic growth and earnings, it is worth considering that markets don’t usually rise in a near-vertical line. It certainly happens historically, but they always eventually end, just when most begin to expect they won’t.”

Since the April lows, the bull streak has defied gravity. While there have been plenty of concerns from a debt downgrade by Moody’s to weakening economic data, tariffs, and a Fed remaining monetarily restrictive, the bull charge has been quite astonishing. The speculative frenzy, driven by retail investors, was fueled by a cocktail of AI euphoria, abundant liquidity, and an insatiable appetite for risk. Consequently, the S&P 500 has enjoyed its third-longest streak of 3-year highs since 1928.

“What a year to be an investor. In pretty much anything, at pretty much any time. Even during the dog days of summer. It’s unusual for stocks to record so many multi-year highs in July. With a week left and helped by six straight record closes, the S&P 500 has already carved out a place in history as one of the best Julys ever. Only two other years have witnessed so many highs during a traditionally slow month.” – Sentimentrader.com

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