A 20-year-old retail trader is making waves on Reddit with a bold bearish thesis on Palantir Technologies, one of the most popular AI stocks among retail investors. Laurence Bradingmunn, posting in a forum dedicated to “The Big Short” investor Michael Burry, has disclosed his significant bet against Palantir through put options with strike prices in 2027 and 2028, mirroring Burry’s own short position on the company.
Bradingmunn’s thesis centers on two key concerns: Palantir’s extreme overvaluation and broader fears about an AI bubble burst. Despite Palantir stock being up 83% over the past year, it has fallen 17% year-to-date, closing Friday at $146.59. The retail trader believes the stock should be worth approximately $50 per share, representing a potential 66% decline from current levels.
The core of Bradingmunn’s argument lies in Palantir’s $350 billion market cap, which he considers unjustifiable when compared to tech giants with similar valuations. He points to companies like AMD, Salesforce, and Adobe as examples of firms with more realistic valuations relative to their actual profits. “I don’t believe [Palantir] can grow quick enough to meet the current valuation,” Bradingmunn told Business Insider.
Beyond valuation concerns, Bradingmunn highlights significant share dilution as a red flag. As of late 2025, Palantir had approximately 2.38 billion shares outstanding, more than double the 1 billion shares when it first listed on the New York Stock Exchange. This dramatic increase in share count dilutes existing shareholders’ ownership.
The retail trader also expressed frustration with the difficulty of understanding what Palantir actually does to generate revenue, and he’s concerned about the stock’s cult-like following among retail investors who admire CEO Alex Karp. Bradingmunn worries that many traders aren’t properly assessing the company’s fundamentals, instead following hype on social media platforms.
While acknowledging that Palantir may benefit from lucrative defense contracts with the US government, Bradingmunn remains convinced that the AI-driven rally has pushed the stock far beyond reasonable levels, echoing Burry’s broader concerns about an AI bubble.
Key Quotes
I’m going shoulder to shoulder with Michael Burry on his thesis that the AI bubble is about to burst—specifically focusing on Palantir’s extreme overvaluation and how the AI bubble (Government) has managed to shoot their stock to the moon
Laurence Bradingmunn explained his reasoning for betting against Palantir, directly citing Michael Burry’s concerns about an AI bubble and government-driven stock inflation. This quote establishes the connection between his bearish position and broader AI market concerns.
If you compare it to the companies with similar market caps, like AMD, Salesforce, Adobe, and you look at their actual profits, it’s a stark contrast. I don’t believe [Palantir] can grow quick enough to meet the current valuation
Bradingmunn provided specific comparisons to justify his valuation concerns, highlighting that Palantir’s market cap appears disconnected from its profit generation compared to peer technology companies. This comparative analysis forms the foundation of his bearish thesis.
It can be very easy to follow someone’s Reddit post talking about how great a stock is, and just fall for that. I’m trying to take a more constructive thesis and to try and look at the actual numbers of all these stocks and see how I can have a different side of the story
The retail trader acknowledged the influence of social media hype while positioning himself as taking a more analytical, fundamentals-based approach. This quote reflects growing sophistication among retail investors in evaluating AI stocks beyond momentum trading.
I believe it should be worth about $50 per share
Bradingmunn’s price target represents a dramatic 66% decline from Palantir’s Friday closing price of $146.59, illustrating the magnitude of overvaluation he perceives in this prominent AI stock.
Our Take
This story represents a fascinating inflection point for AI investment sentiment. While retail traders have been among the most enthusiastic supporters of AI stocks, seeing a young retail investor construct a detailed bearish thesis signals maturing market analysis. The fact that Bradingmunn specifically cites the AI bubble as central to his thesis, rather than just Palantir-specific issues, suggests growing awareness that AI valuations may have outpaced reality. The share dilution concern is particularly noteworthy—doubling outstanding shares while maintaining high valuations raises legitimate questions about value creation versus value extraction. What’s most interesting is how this mirrors the dot-com bubble pattern: revolutionary technology driving irrational valuations. Whether Bradingmunn proves correct or not, his willingness to challenge consensus on a beloved AI stock represents healthy market skepticism that the AI sector needs to maintain long-term credibility and sustainable growth.
Why This Matters
This story highlights growing skepticism about AI stock valuations at a critical moment for the technology sector. Palantir has become a bellwether for AI investment enthusiasm, particularly among retail traders, making bearish theses like Bradingmunn’s significant indicators of shifting sentiment.
The involvement of Michael Burry, famous for predicting the 2008 financial crisis, adds credibility to concerns about an AI bubble. When prominent investors take short positions on high-flying AI stocks, it signals potential overvaluation risks across the sector. This matters for the broader AI industry because excessive valuations can lead to market corrections that impact funding, innovation, and public perception of AI technologies.
For businesses and investors, this serves as a reminder to scrutinize AI company fundamentals rather than riding momentum. The dramatic share dilution Bradingmunn identifies at Palantir could be a warning sign for other AI companies as well. As AI continues transforming industries, distinguishing between sustainable AI businesses and overvalued hype becomes increasingly critical for market stability and long-term technological progress.
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Source: https://www.businessinsider.com/retail-trader-palantir-bearish-thesis-short-michael-burry-2026-1