Palantir Technologies Inc. (NYSE:PLTR) is taking over the world, and you're worried about one earnings announcement? Instead of posting a small profit of three cents per share, Palantir reported a loss of one cent per share. Many investors did not take the news well, and Palantir ended Monday's session down by about 14%. Additionally, Palantir dropped by another 8% by late Tuesday's session.
Moreover, Palantir's stock is still down by about 80% from its ATH, floating around its IPO price from almost two years ago. However, Palantir is a high-growth company with a highly long growth runway. Furthermore, Palantir demonstrates substantial profitability potential and should become increasingly profitable with time. Also, as a Palantir investor, I am more focused on the 250% YoY increase in the U.S. commercial customer count rather than the one-cent loss.
Palantir is a rapidly growing monopolistic-style company that has the potential to take over the world. No, not literally, but Palantir's software products and services are being adopted by more and more agencies and companies in the U.S. and globally. Therefore, Palantir should continue expanding operations, growing revenues, and increasing profits as the company advances. This dynamic should lead to increased demand for the company's shares, and Palantir's stock price should appreciate considerably in the coming years.
Palantir is a monopolistic, high-growth company with a remarkably long growth runway and massive profitability potential. Moreover, Palantir has a significant competitive advantage - the U.S. government. U.S. government agencies prefer Palantir, and for a good reason. Before Palantir's solutions, agency databases were "siloed," forcing users to search specific databases individually. Now, everything is linked together using Palantir. For example, thanks to Palantir, the FBI can access critical data from a police department without going through miles of red tape.
There is some mystery about what Palantir does and what makes the company unique. In essence, Palantir's software combines various operational elements, making them work seamlessly and safely. Palantir could also be viewed as the master of data, and critical information, a remarkably profitable business in this age. Many market participants are too busy "counting pennies" rather than concentrating on the future.
I've said that Palantir does not need to be profitable now because specific companies (like Palantir) can increase profitability when their growth potential begins running out. For now, it does not matter if Palantir makes a modest profit or reports a slight loss in the greater scheme of things. It is enough that Palantir demonstrates the potential for significant profitability down the line. For now, Palantir should continue focusing on growing customer count, increasing revenues, hiring and retaining top talent, and providing the best products and services in its industry.
Furthermore, Palantir has worked closely with numerous government agencies for years, adding to the perception that Palantir is the most trustworthy company in its space. Thus, we see the continuous growth and increased interest in Palantir's solutions from commercial clients. Around this time last year, Palantir only had 39 corporate clients in the U.S.; now, that number is 119. In addition, Palantir's products are very sticky and have high switching costs. Therefore, once on Palantir's software, a company should become a long-term consumer of Palantir's products and services.
Q2 - Better Than The Initial Reaction
Statement of Operations
We continue seeing robust revenue growth while the cost of revenue declines. YoY revenues jumped by 26%, but the cost of revenue increased by only 12%. Gross profit came in at $370.8 million, surging by 30% YoY. Therefore, we see Palantir becoming increasingly profitable with scale. This trend of higher profitability is constructive and should continue, becoming more pronounced as the company continues expanding operations and revenues in future years.
Additionally, we see a positive trend of lower operating expenses. Sales and marketing grew slightly, R&D declined, and SG&A expenses were roughly flat YoY. In general, operating costs fell by 4% YoY. Additionally, stock-based compensation continues declining, dropping by more than 30% YoY. The adjusted operating margin came in at 23%. The adjusted gross margin came in at approximately 80.8% for the quarter, demonstrating remarkable profitability and massive earnings potential.
We saw robust YoY revenue growth, with an ever higher 45% growth rate in the U.S. Palantir's commercial business is performing excellently, growing revenues by 46%, with outperformance in the U.S., increasing revenues by a whopping 120% in that crucial market. Moreover, the U.S. commercial customer count exploded by 250% YoY, illustrating incredible demand for Palantir's products and services and implying significant future growth and widespread adoption for Palantir.
Palantir Could Achieve Widespread Adoption
Karp, Palantir's CEO, said that Palantir remains focused on the long term, and so should you if you're a Palantir shareholder.
"We are working towards a future where all large institutions in the United States and its allies abroad are running significant segments of their operations, if not their operations as a whole, on Palantir." - Alex Karp.
We must consider that Palantir is in the very early stages of its operations, growth, and profitability. Yet, the company offers the top products and services in its space. If it did not, Palantir probably wouldn't be the contractor of choice for the U.S. government, including the DOD, CIA, NSA, and other intelligence agencies. Moreover, Palantir probably wouldn't be seeing such spectacular growth in the corporate space if its competitors had the upper hand. Furthermore, we see that Palantir has significant competitive advantages. Thus, we can conclude that Palantir could achieve widespread adoption in the corporate world. Suppose Alex Karp is right and large government, civil, and corporate institutions of the U.S. and its allies run significant portions of their operations on Palantir. In that case, the sky is the limit, and Palantir's stock price should advance significantly in the coming years.
Here's what Palantir's financials could look like in the future:
Year
2022
2023
2024
2025
2026
2027
Revenue $
2b
2.6b
3.4b
4.4b
5.7b
7.3b
Revenue growth
30%
30%
30%
30%
28%
25%
Forward P/S ratio
7
8
9
9
8
8
Price
$9
$14
$21
$27
$32
$40
Source: The Financial Prophet
Palantir is trading around seven times forward sales estimates, and the P/S multiple could expand as the company advances. Palantir has a log growth runway, and the company's revenue growth could be around 30% in the coming years. In comparison, Nvidia (NVDA) has slower growth projections, and the stock trades at about 14 times next year's sales estimates. Valuations of ten times sales and higher are widespread in the hardware and software industries.
Even Microsoft (MSFT), a mature software company, trades at approximately nine times forward sales, more expensive than Palantir. Therefore, we see that Palantir is relatively cheap and could experience multiple expansion as the company advances in future years. Thus, as Palantir continues increasing revenues and improving profitability, its stock could reach the $40 - 50 range within several years.
Risks To Palantir
Despite my bullish outlook for Palantir, market participants should consider several potential risks associated with this investment. While the growth story is strong at Palantir, shares are not cheap by traditional metrics. Furthermore, the company's earnings are still minimal and may not increase as much as I envision. Moreover, if the company's growth picture were to turn less bullish, the stock could head in the wrong direction. For instance, if Palantir lost favor with the government or had a data breach, the stock could experience a notable decline. Please consider these and other risks carefully before investing in Palantir.
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Based on 12 Wall Street analysts offering 12 month price targets for Palantir Technologies in the last 3 months. The average price target is $10.50 with a high forecast of $15.00 and a low forecast of $6.00. The average price target represents a -30.09% change from the last price of $15.02.
Palantir Technologies is forecasted to grow earnings and revenue by 55.2% and 15.9% per annum respectively. EPS is expected to grow by 56.4%. Return on equity is forecast to be 10.7% in 3 years.
The 12 analysts offering 12-month price forecasts for Palantir Technologies Inc have a median target of 8.25, with a high estimate of 18.00 and a low estimate of 5.00. The median estimate represents a -46.71% decrease from the last price of 15.48.
It requires a lot of manual work and is very time-consuming to get to a functional point. The solution could use more online documentation for new users. Learn what your peers think about Palantir Foundry. Get advice and tips from experienced pros sharing their opinions.
The LTV is therefore approximately $5.6m per customer per year * (6.6 + 3.5) years = ~$57m per customer. The CAC is a bit harder to estimate, and I admit I could be way off here. Palantir discloses that it brought in $5.6m of revenue from new customers in H1 2020.
As of 06/12/2023, Enterprise Value is likely to grow to about 11.5 B, while Tangible Asset Value is likely to drop slightly above 3.3 B. Palantir TechnologiesInc holds a recent Real Value of $12.64 per share. The prevailing price of the company is $15.02. At this time, the company appears to be overvalued.
Vanguard Group Inc ownership in PLTR / Palantir Technologies Inc - Class A. 2023-02-09 - Vanguard Group Inc has filed an SC 13G/A form with the Securities and Exchange Commission (SEC) disclosing ownership of 161,635,065 shares of Palantir Technologies Inc - Class A (US:PLTR).
Palantir Technologies is not owned by hedge funds. The company's largest shareholder is The Vanguard Group, Inc., with ownership of 7.6%. With 7.0% and 4.4% of the shares outstanding respectively, Peter Thiel and BlackRock, Inc.are the second and third largest shareholders.
The financial health and growth prospects of PLTR, demonstrate its potential to underperform the market. It currently has a Growth Score of A. Recent price changes and earnings estimate revisions indicate this would not be a good stock for momentum investors with a Momentum Score of D.
The all-time high Palantir Technologies stock closing price was 39.00 on January 27, 2021. The Palantir Technologies 52-week high stock price is 17.16, which is 16.8% above the current share price.
The average price target for Amazon is $137.18. This is based on 38 Wall Streets Analysts 12-month price targets, issued in the past 3 months. The highest analyst price target is $165.00 ,the lowest forecast is $111.00. The average price target represents 11.14% Increase from the current price of $123.43.
Future price of the stock is predicted at 6.7221226887679$ (-54.318% ) after a year according to our prediction system. This means that if you invested $100 now, your current investment may be worth 45.682$ on 2024 June 08, Saturday.
Palantir was founded in 2003 by Thiel, a PayPal cofounder and early Facebook investor, along with Karp and computer scientist Stephen Cohen. The company often makes headlines for its ties with well-known investors, such as philanthropist George Soros and Ark Invest founder Cathie Wood.
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Palantir Technologies Inc (Palantir) is a software company that develops data fusion platforms. The company facilitates machine-assisted and human-driven data analysis. Its product platform includes Palantir Gotham, Plantir Apollo and Palantir Foundry.
As of today (2023-06-07), Palantir Technologies's Intrinsic Value: Projected FCF is $0.00. The stock price of Palantir Technologies is $14.69. Therefore, Palantir Technologies's Price-to-Intrinsic-Value-Projected-FCF of today is 0.0. in the Software industry.
It is likely to report GAAP profits well ahead of expectations due to good cost control, showing that the business is improving its fundamentals and the company's business strategy is now turning from a 'growth' phase to a profitable one.
The company lost $101 million in the first quarter, a sign it's struggling to improve margins by offering more automated data analysis software. The net loss was an improvement over the same period a year ago but wider than analysts expected.
The company's revenue is slowing as businesses curtail capital investments. Palantir (PLTR 3.40%) reported third-quarter earnings results that displeased investors. The company's revenue growth is slowing as businesses reduce expenses.
Investors holding Palantir shares need not worry about the company blowing up or running into solvency issues. However, there isn't a lot to suggest those lofty expectations of early 2021 will return anytime soon.
Palantir stock has outperformed the market since we published our previous Buy rating. Therefore, we believe the market has likely priced in a recessionary scenario for PLTR. The consensus estimates remain confident in management's guidance of a revenue CAGR of 30% through 2025.
Palantir Technologies has a total shareholder equity of $2.8B and total debt of $0.0, which brings its debt-to-equity ratio to 0%. Its total assets and total liabilities are $3.7B and $879.9M respectively.
Around a year back, Palantir estimated sales to grow by 30% annually through 2025. But in 2022, its sales were up 24% and are on track to increase by “just” 16% this year. Wall Street, though expects sales growth to accelerate by 19% in 2024, which is still much lower than Palantir's forecast.
In the March quarter, it had net income of $17 million. However, decelerating revenue growth is an issue. In 2022, revenue growth slowed to 24% from 40% in 2021 and 47% in 2020. Also, Palantir gets nearly 60% of its revenue from government agencies.
The business model of Palantir primarily makes money from the sale of subscriptions to access its software in its hosted environment along with ongoing O&M services (“Palantir Cloud”); software subscriptions in our customers' environments with ongoing O&M services (“On-Premises Software”); and professional services.
Largest shareholders include Vanguard Group Inc, BlackRock Inc., VTSMX - Vanguard Total Stock Market Index Fund Investor Shares, Renaissance Technologies Llc, VIMSX - Vanguard Mid-Cap Index Fund Investor Shares, State Street Corp, VEXMX - Vanguard Extended Market Index Fund Investor Shares, Geode Capital Management, ...
Splunk. Like Palantir, Splunk software analyzes and visualizes data in real-time. But Splunk specializes in machine-generated data, while Palantir ingests all data forms.
Their SaaS is one of five offerings authorized for Mission Critical National Security Systems (IL5) by the U.S. Department of Defense. Palantir Foundry is used by corporate clients such as Morgan Stanley, Merck KGaA, Airbus, Wejo, Lilium, and Fiat Chrysler Automobiles.
Nonetheless, even though he co-founded Palantir, they have not owned bitcoin and the reason for this is because crypto is volatile, not sure if you're paying attention to the crypto markets, but they're not good.
Palantir Technologies is not owned by hedge funds. Our data shows that The Vanguard Group, Inc. is the largest shareholder with 7.8% of shares outstanding. Peter Thiel is the second largest shareholder owning 6.9% of common stock, and BlackRock, Inc. holds about 4.7% of the company stock.
N) stock surged 22% on Tuesday, putting it on track for its biggest one-day gain in more than two years, after the data analytics firm said it expected to turn a profit every quarter in 2023 and pointed to massive interest in its new AI platform.
Palantir Gotham is a commercially-available, AI-ready operating system that improves and accelerates decisions for operators across roles and all domains. For over a decade, Gotham has surfaced insights from complex data for global defense agencies, the intelligence community, disaster relief organizations, and beyond.
Future price of the stock is predicted at 6.862263757246$ (-54.312% ) after a year according to our prediction system. This means that if you invested $100 now, your current investment may be worth 45.688$ on 2024 June 11, Tuesday.
The 12 analysts offering 12-month price forecasts for Palantir Technologies Inc have a median target of 8.25, with a high estimate of 15.00 and a low estimate of 5.00. The median estimate represents a -45.04% decrease from the last price of 15.01.
10% Return for S&P 500 a Real Possibility by End of 2023
And in today's market, with its newfound emphasis on fundamentals, earnings really matter. Short of a recession — a very real possibility — consensus estimates are for about 5% earnings growth for S&P 500 companies in 2023.
The rise from today to year-end: +76%. In the middle of 2023, we expect to see $359 per 1 Tesla. In the first half of 2024, the Tesla price will climb to $560; in the second half, the price would add $126 and close the year at $686, which is +181% to the current price.
Historical dividend payout and yield for Palantir Technologies (PLTR) since 1971. The current TTM dividend payout for Palantir Technologies (PLTR) as of June 12, 2023 is $0.00. The current dividend yield for Palantir Technologies as of June 12, 2023 is 0.00%.
Palantir has been touting its AI offerings for a while, but in its earnings call this week, it used the term “AI” and its synonyms 50 times. Karp said that right now, the company has “no pricing strategy” for its AI products. He explained: “We're going to get hundreds of customers and we will price it as we go.
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The stock market is poised for a strong rally in 2024 as corporate earnings impress and trillions of dollars of sidelined cash gets invested, according to a Monday note from Bank of America.
Introduction: My name is Dan Stracke, I am a homely, gleaming, glamorous, inquisitive, homely, gorgeous, light person who loves writing and wants to share my knowledge and understanding with you.
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