Billionaire Israel Englander Buys 2 Artificial Intelligence (AI) Stocks Up 405% and 575% in 2 Years

Palantir reported Q2 revenue growth of 93% to $1.9 billion and 215% growth in non-GAAP EPS to $0.41, while Astera Labs grew revenue 104% to $392 million and non-GAAP EPS 82% to $0.80. Astera guided for Q3 revenue growth of 139%, driven by Scorpio switches, as both companies benefit from expanding AI infrastructure and enterprise-AI spending. Valuations remain elevated at 155x adjusted earnings for Palantir and 145x for Astera, although median analyst targets imply 12% and 18% upside, respectively.

Analysis

The signal from a 13F-style ownership change is weaker than it appears: it is backward-looking, omits hedges and derivatives, and says nothing about Millennium's entry price or position-level risk budget. For PLTR, the key issue is not AI demand but conversion of pilots into durable, high-margin production deployments; any deceleration in net-dollar retention, commercial deal duration, or remaining-deal-value growth would expose a valuation regime dependent on sustained operating leverage. Government demand provides backlog visibility but also creates procurement-timing and budget-resolution risk, making quarterly bookings more volatile than the market's premium multiple implies.

ALAB is more directly tied to accelerator-cluster complexity, where interconnect content can rise faster than GPU units as racks scale and inference traffic becomes more east-west intensive. The second-order beneficiaries include AVGO and MRVL in switching/custom silicon, while CRDO is the closest public connectivity substitute; however, hyperscaler qualification cycles and customer concentration can turn a product-transition quarter into a sharp inventory correction. Scorpio ramp execution is therefore the near-term determinant of whether revenue converts into gross-margin expansion rather than merely a mix-driven growth spike.

Consensus appears to treat enterprise AI software and AI networking as one directional trade, but their risk profiles diverge materially. PLTR is vulnerable to multiple compression from even modest execution normalization; ALAB has greater upside torque if next-generation rack architectures broaden adoption, but also greater downside from a single platform delay or customer insourcing. Over the next 1-3 months, earnings guidance and customer concentration disclosures matter more than AI-themed fund flows; over 6-18 months, inference deployment intensity is the common structural catalyst.

Key Decisions for Investors

• Prefer a relative-value long ALAB / short PLTR position over an outright AI-beta allocation for the next 1-3 months, sized dollar-neutral. The thesis is that ALAB has more measurable infrastructure content upside while PLTR has greater duration/multiple risk; exit if ALAB's next-quarter guide misses consensus or PLTR reports accelerating commercial remaining-deal value and retention.
• Do not chase PLTR after momentum-driven advances. Establish a watch level only after a 15-20% pullback or after two quarters demonstrating stable margin progression alongside bookings growth; invalidate the valuation-risk thesis if forward earnings estimates rise faster than the share price for two consecutive reporting cycles.
• For ALAB, initiate only a half-sized long ahead of the next earnings report and add after verification that Scorpio mix is accretive to gross margin and no top customer exceeds prior concentration expectations. A 20-25% downside stop is appropriate given qualification and platform-transition risk; upside requires sustained guidance raises rather than a single beat.
• Monitor CRDO and MRVL as read-through hedges: relative underperformance in ALAB versus CRDO after results would suggest product-specific execution risk, while broad weakness across ALAB, CRDO, AVGO and NVDA would point to a hyperscaler capex or cluster-deployment pause rather than company-specific deterioration.