Palantir was starting the week lower as shares of the artificial-intelligence company declined 2.5% on Monday.

Palantir trading below its all-time closing high of $130.18, which it notched on May 14.

There appeared to be no material news driving shares lower on Monday, rather, a recent run-up in price could be to blame. Ramping interest in AI at both the federal and commercial level has been a boon for growth, sending Palantir higher over the past few years. The stock began rising sharply in 2024 and only continued to climb.

However, its fundamentals may tamp down its growth. Barron's previously reported on Palantir's high valuation and three-year beta, which represents a stock's volatility relative to the broader market.

A beta value greater than 1 indicates a stock is more volatile than the market itself. At the time of reporting in late March, Palantir had a three-year beta of 1.8. At last check, that figure had decreased marginally to 1.5, according to Dow Jones Market Data.

Moreover, Palantir's valuation remains sky-high. The most recent data shows the stock trading at 198 times 12-month forward earnings.

Shares declined earlier this month on the heels of Palantir's first-quarter earnings report. While revenue topped analysts' expectations, commercial revenue growth outside the U.S. fell 5%, largely due to poor performance in Europe.

Enthusiasm abounds for the company's potential to dominate the market for AI-powered data analytics. Palantir remains firmly rooted in the defense sector, and appears to be the platform of choice for the U.S. Army and other agencies. However, the stock's fundamentals may make it a less attractive buy to some analysts.

Most on Wall Street are hesitant to say the price will move significantly higher. Of 26 firms polled by FactSet, 16 rate Palantir at Hold, five have it at Sell, and five rate it at Buy or the equivalent.