Forget Palantir Stock at $140 per Share. Buy This Artificial Intelligence (AI) Chip ETF Instead.

Palantir has been one of the best-performing stocks on the market over the past three years.

But with a forward P/E ratio of over 100, Palantir is trading at an extremely high multiple.

The VanEck Semiconductor ETF invests in the largest chipmakers and has posted stellar returns.

Palantir (NASDAQ: PLTR) has been one of the best-performing stocks over the past few years, with a 113% average annualized return over the past three years.

The artificial intelligence (AI) software juggernaut, which governments and enterprises use to analyze massive amounts of data, has seen its stock price decline significantly in 2026, down about 20% year to date to around $140 per share.

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It's not for a lack of growth or prospects. The company just posted numbers that show revenue rose 85% year over year and net income skyrocketed 306%. Palantir also raised its guidance for revenue this fiscal year to $7.65 billion to $7.66 billion, which would be a 71% increase over last year. That would be a higher growth rate than 2025's 56% revenue increase.

But this strong earnings report and outlook did not move the needle higher for Palantir stock ; in fact, the stock price dropped 7% after the report was released. This is likely because it is trading at an extremely high multiple. Palantir has a price-to-earnings (P/E) ratio of 180 and a forward P/E of 110 -- and that's down from 412 and 177 at the start of the year. Investors just don't see the type of growth needed to sustain that high multiple, thus the sell-off.