Anthropic's IPO could value the company at over $2 trillion, above the valuation SpaceX reached when it went public earlier this year, which may draw investor attention to AI stocks. Palantir CEO Alex Karp has called frontier AI labs like Anthropic too risky, and the article suggests investors may find Palantir, valued below $500 billion, a more favorable AI stock. The stock trades near $200, close to its 52-week high; in its last quarter, revenue grew 93% to $1.9 billion and operating income was 47% of revenue, with third-quarter results expected next week. The author estimates that reaching $300 would require a market cap above $700 billion, about a 50% rise, which seems unlikely in a short period given the stock trades above 170 times earnings. In the author's view, at its current valuation the downside risk looks greater than the upside potential.
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