Late Monday, Palantir PLTR delivered fourth-quarter earnings and the results were good enough to send the stock soaring Tuesday. Those days are in the rearview mirror, but traders looking to amplify Palantir gains or potentially hedge long positions in the stock can’t afford to ignore the the Direxion Daily PLTR Bull 2X Shares (PLTU ) and the Direxion Daily PLTR Bear 1X Shares (PLTD ).
With Palantir ranking as a headline-generating story stock, either or both Direxion ETFs could merit consideration over 2026.
For traders not familiar with those ETFs, the bullish PLTU attempts to deliver 200% of Palantir’s daily performance. Meanwhile, the bearish PLTD moves inverse of that stock. So if those shares fall by 1% on a given day, PLTD should rise by the corresponding amount. It’s not a stretch to say both PLTD and PLTU will be useful to tactical traders going forward.
Reasons to Consider the Palantir ETFs
Investors that are familiar with Palantir know that one of the most oft-cited criticisms of the stock is that it’s stretched on valuation. This encourages evaluating PLTD. There are some supporting arguments for that point of view.
“Palantir trades at roughly 90 times trailing 12-month revenue, a 350% premium over other artificial intelligence firms. We believe the firm needs to deliver an average annual growth rate of 30% over five years (75th percentile in the software universe) to justify investing at these levels,” noted Morningstar analyst Mark Giarelli.
On the other hand, market history consistently proves that valuation alone isn’t a reason to buy or sell a stock. Simply because Palantir is expensive doesn’t mean upside is limited. Nor does its high multiple render PLTU useless for aggressive traders. Actually, the opposite could prove true.
“Our analysis of previous technological innovators, dating back to the 1970s, shows that 30% average annual growth over five years is possible, especially when a new category emerges, like Palantir’s ontology framework, and rapid expansion follows,” added Giarelli.
Aiding Palantir is the point that the stock isn’t being painted with the same ominous brush as other software names.
“While many software investors have been burned by the “AI displaces software” thesis that has hit many software stocks, Palantir is an outlier,” concluded Giarelli. “The platform appeals to automation-hungry enterprises by harnessing the latest language models to work with or replace legacy products.”
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