If you’ve spent any time on FinTwit or Reddit lately, you’ve seen the chatter. People are obsessed with a potential Palantir stock split. It’s almost a religious debate at this point.
The logic usually goes like this: the stock has skyrocketed, the S&P 500 inclusion happened, and now Alex Karp is going to pull the trigger to "make it accessible." But honestly, most of these theories ignore how Palantir actually operates.
Palantir is currently trading around $177 per share as of mid-January 2026. That is a massive jump from where it was a couple of years ago. It’s been a monster. We’re talking about a company that added 135% in 2025 alone after a legendary 2024.
But does a $170 price tag trigger a split? Historically, not really.
The Reality of the Palantir Stock Split Potential
Let's look at the numbers. Nvidia waited until they were north of $1,000 to do their 10-for-1 split. Chipotle did the same. Even Broadcom waited for a massive four-digit price tag.
Palantir is expensive, sure, but it isn't "unaffordable" for a retail investor to grab a few shares. Most brokerages allow fractional shares anyway. The psychological barrier of a $170 stock is nothing like the barrier of a $1,200 stock.
Karp isn't your typical CEO. He doesn't seem to care about short-term stock price mechanics as much as he cares about "crushing" short-sellers, as he’s mentioned in recent CNBC interviews. In November 2025, he specifically called out Michael Burry’s short position as "bat s*** crazy." He’s focused on the mission—and the mission is currently firing on all cylinders.
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Why a split might actually happen (The Steelman Case)
There is one legitimate reason why Palantir might consider a split in 2026.
Employee compensation. Palantir relies heavily on stock-based compensation (SBC) to attract the best engineers in the world. When your stock price is high, it’s harder to fine-tune those grants for the rank-and-file employees. A split creates more "units" to move around.
Also, look at the liquidity. Palantir already has a massive share count—over 2.3 billion shares outstanding. A 10-for-1 split would put them at 23 billion shares. That’s a lot of paper. It would make PLTR one of the most liquid, high-volume stocks on the planet, which could actually appeal to the "retail army" that Karp often praises.
The Valuation Problem No One Wants to Talk About
Here is the "kinda" scary part.
Palantir’s valuation is currently in another dimension. As of early 2026, it’s trading at a trailing price-to-sales (P/S) ratio of over 100. For context, most software companies are considered "expensive" at a P/S of 20.
- Commercial Growth: It’s actually holding up the valuation. In Q3 2025, U.S. commercial revenue grew 121% year-over-year.
- The "Rule of 40": Palantir’s score is currently a staggering 114%.
- Net Income: They are GAAP profitable and have been for several quarters.
But even with those insane numbers, the stock is "priced for perfection," as the saying goes. If the AI bubble faces a macro correction in 2026, a stock split won't save the price from a 30% or 40% haircut.
What the Experts are Saying Right Now
Wall Street is divided. Some analysts, like those at RBC Capital, noted that retail traders were practically begging for a split announcement during the November 2025 earnings call. It didn't happen.
Instead, the company raised its full-year 2025 revenue guidance to roughly $4.4 billion. They are basically growing into a massive enterprise at a speed we haven't seen since the early days of Google or Facebook.
The bears, including some vocal skeptics at The Motley Fool and various hedge funds, argue that the stock is a "bubble" that could burst this year. They point to the fact that while the business is great, the stock price has disconnected from reality.
Will 2026 be the Year?
If Palantir hits $300 or $400 by the summer of 2026, the pressure for a split will become intense. At the current $170 range? It feels unlikely.
Management has shown they are happy to let the stock run. They are winning massive government contracts and the "AIP Bootcamps" are converting commercial customers at a record pace.
Actionable Insights for Investors:
- Watch the $200 level: If the stock breaks and holds above $200, the "split watch" will move from a whisper to a roar.
- Focus on U.S. Commercial Revenue: This is the heart of the bull case. If this growth slows below 50%, the valuation will likely collapse, split or no split.
- Don't buy for the split: Never buy a stock just because you hope for a split. It doesn't change the underlying value of your investment; it just changes the number of slices in your pizza.
- Mind the P/S Ratio: If you’re a value-conscious investor, Palantir is a nightmare right now. If you’re a momentum trader, it’s a dream. Know which one you are before clicking "buy."
Palantir is basically the "anti-woke," high-performance data engine of the modern era. Whether it splits its stock or stays as-is, the real story is whether its software becomes the operating system for the entire U.S. government and the Fortune 500. Everything else is just noise.
Check the next quarterly earnings report—usually scheduled for February—to see if the board has had any internal discussions about share restructuring. Until then, keep your eyes on the commercial growth rates.