Michael Burry: Palantir Worth Under $1 Long-Term, Adds Puts

Michael Burry is back on the Palantir short, and this time the target is not a haircut, it is a wipeout. Palantir is trading around $175, but Burry says the intrinsic value is under a dollar over the long run.

The trade

Burry has re-entered out-of-the-money put trades on Palantir, purchasing March 2027 puts with strike prices in the low-to-mid $100s as option volatility cooled, and he sees Palantir shares at under $1 over the long run.

Writing in his Cassandra Unchained report, Burry disclosed he took advantage of implied volatility falling to multi-month lows to rebuild the bearish position at cheaper option prices. That is a notable detail for options traders, he waited for IV to bleed before reloading.

The bear case

Palantir trades near $175.52 at a market cap of roughly $420 billion, with a trailing price-to-sales ratio of 73.19 and a forward P/E of 112.36. Burry has moved past a simple multiples argument.

He points out that Palantir issued 31.3 million shares to staff worth roughly $5 billion over the past year, which amounts to about six times its stock-based compensation expense, the widest accounting gap among 66 companies he recently reviewed. He further noted that off-balance-sheet non-cancellable infrastructure purchase commitments have more than tripled this year, leading him to conclude that the stock is intrinsically worth under $1 in the long run.

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The bull rebuttal

The fundamentals are not cooperating with the thesis right now. Revenue grew 93%, commercial sales increased 149%, government revenue rose 90% and adjusted free cash flow reached $1.22 billion in the latest quarter.

U.S. commercial revenue increased 149% to $764 million, while U.S. government revenue climbed 90% to $809 million, and adjusted free cash flow reached $1.22 billion, producing a 63% margin. A sub-$1 outcome requires the entire government and commercial franchise to effectively collapse, not just multiple compression.

Burry’s wider AI short book

Burry has been ramping wagers against the wider AI boom, retaining his short against Nvidia and recently making bets against Oracle and the neocloud Nebius. The Palantir call is the loudest piece of a broader AI-skeptic positioning.

Options market and stocks to watch

Watch for reactions across the AI complex:

PLTR: watch put flow into March 2027 expiries around the $100 strike, and any spike in implied volatility from headline risk.

NVDA: watch for spillover if Burry’s AI-bubble framing gains traction with macro funds.

ORCL: watch for skew changes given Burry’s disclosed short.

NBIS: watch the smaller neocloud names for outsized moves on any AI-capex rethink.

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