Palantir Technologies enters the final stretch before its August 3 earnings print with short interest continuing to climb, options traders leaning mildly bullish, and the CTO quietly selling into strength — a setup where the positioning narrative and the fundamental story are pulling in opposite directions.
The most notable development this week is that short sellers have not given up. SI has risen 12% over the past week to nearly 89.7 million shares, now representing 3.9% of free float — up a third over the past month. That is a meaningful acceleration from the 3.5% level flagged in prior notes, and it is happening into a stock that has already rallied roughly 15% from late June lows. Bears have now added to a losing position through multiple sessions of price appreciation. The borrow market offers them no relief on cost — CTB has actually eased over the week, falling 20% to 0.40% — but availability remains vast at nearly 5,851% of short interest, meaning there are roughly sixty shares available for every one currently borrowed. No mechanical squeeze pressure exists. The short book is bleeding on pain of will, not friction.
Options positioning tells a different story from the short sellers. The put/call ratio has drifted to 0.92, about 1.3 standard deviations below its 20-day average of 0.95 — the most call-skewed it has been in months. That means options traders, on balance, are leaning into upside rather than hedging against downside. With the 52-week high for the PCR at 1.16 and the low at 0.61, the current reading sits well within normal range, but the direction of travel is toward risk-on sentiment. The short sellers and the options market are describing two opposite views of the same stock.
The Street is similarly divided, though recent analyst moves lean constructive. DA Davidson upgraded to Buy on July 2, lifting its target to $175. Wolfe Research moved off its Underperform stance in mid-June. Wedbush and Rosenblatt have maintained bullish targets in the $225-$230 range. The holdouts are real: RBC Capital maintained its Underperform with a $90 target after the last earnings print — a view that, at $133.72, requires either a significant earnings disappointment or a broad derating. The consensus sits at Hold with a mean target of $185, though that figure is dated to March and the stock has since traded both above and below it. Valuation remains extreme: the P/E has compressed from prior highs but still reads at 64x trailing, and the EV/EBITDA of 47x has fallen over the past month but remains a stretch by any conventional software multiple. The bear case is less about the business — revenue growth is real — and more about what multiple the market is willing to sustain into a post-AI-hype environment.
Insider activity adds a cautionary note. CTO Shyam Sankar sold $24 million of stock on July 2 at $130 — the largest single insider transaction in the recent window — while the stock was already near its highs. Other directors trimmed in mid-June. The 90-day net insider figure is positive in share terms, but that reflects option exercises and grants rather than open-market purchases. No insider has been a buyer. Taken alongside the short buildup and the $480 million government contract expansion reported this week (which drove Tuesday's 2.8% gain), the picture is of insiders and institutional bears both treating the rally as a selling opportunity while the headline newsflow remains constructive.
Earnings on August 3 is the event that resolves the tension. The last two quarterly prints produced next-day declines of roughly 5-7%, with five-day moves extending the losses to as much as 14%. Whether shorts are early or right, and whether options traders' call bias is rewarded or punished, will depend almost entirely on whether the Q2 revenue beat is large enough to justify a multiple that has already priced in aggressive growth.
See the live data behind this article on ORTEX.
Open PLTR on ORTEX →ORTEX Market Intelligence content is generated by AI from a snapshot of ORTEX's proprietary data. Content is informational only and does not constitute investment advice.
