While the operational momentum is clearly solid, investors should pay closer attention to the risks. History shows Palantir stock can fall hard as sentiment shifts.

Palantir (NASDAQ:PLTR) stock has been the subject of a mad scramble in recent years, as investors rush to ride the big data company’s momentum.

If one had bought Palantir on Aug. 8, 2022, a $1,000 investment would be worth about $15,700 today. Three years ago, a dramatic pullback from the highs of the 2021 bull market left Palantir trading below $10 per share, the approximate level where it sold on its first day of trading on Sept. 30, 2020.