These 2 Stocks Are in Free Fall, and It's Still Too Early to Buy Them

Palantir - Palantir's stock is down approximately 37% from its high, and its valuation remains steep with a forward price-to-sales (P/S) ratio over 49 times, despite only 36% year-over-year revenue growth last quarter [1][3] - The company's revenue growth outlook is uncertain due to potential reductions in government spending, as the U.S. government, which accounts for about 42% of its total revenue, is looking to cut its budget by 8% over the next five years [4][5] - Palantir has seen significant growth in its commercial sector, particularly with the introduction of the Palantir Artificial Intelligence Platform (AIP), which has attracted new customers [6][7] - A more attractive entry point for Palantir stock would be in the low $40s, which would bring its forward P/S multiple to about 20 based on analysts' projections for 2026 [8] Tesla - Tesla's stock has also seen a significant drop, with automotive revenue falling by 6% in 2024 and 8% in Q4, while deliveries were down 1% for the year [9][10] - CEO Elon Musk's political involvement may alienate a portion of potential customers, and rising material costs combined with slowing sales present challenges for the company [11] - While Tesla's future may hinge on technologies like autonomous driving and AI, there is skepticism regarding Musk's track record of delivering on ambitious technological promises [12][13][14]