Why is Palantir stock down so much?
Shares of Palantir closed down more than 21% on Monday after the company issued a weaker-than-expected revenue outlook and missed on the bottom line in its first-quarter results. Here are the key numbers: Earnings per share (EPS): 2 cents adjusted vs 4 cents expected, according to a Refinitiv survey of analysts.
While the company is still not yet profitable on a GAAP basis, it is generating ample free cash flow and has a cash-rich balance sheet. I rate the stock a strong buy as one of the more compelling opportunities in the tech sector.
Looking ahead, Palantir is optimistic about delivering annual revenue growth of 30% or more through 2025. The company feels that there is a “wide range of potential upside” to deliver revenue above its Q2 outlook, including demand triggered by the ongoing geopolitical events.
Fair Value Of $2.50 (If Being Generous)
Even though Palantir is in a downtrend and its stock price has dropped by more than 54% in 2022, investors continue to ignore the numerous red flags.
The Bottom Line. Palantir is a classic case of a long-term growth stock that has been hit hard by the current macroeconomic downturn. With the market in fear of a recession, growth stocks like Palantir that are still struggling to prove sustainable long-term growth profitability are naturally avoided by investors.
Palantir's path toward a trillion-dollar market cap
If it hits its target for 2025, then continues to grow its revenue at an average rate of 20% over the following 10 years, it could generate nearly $27 billion in revenue in 2035.
However for five years' time, in March 2027, the service forecasted Palantir to be effectively zero. Coin Price Forecast's algorithm is much more optimistic, with a price target of $29.55 by 2025 and $47.5 by 2030. Note that analyst PLTR predictions can be wrong.
According to the issued ratings of 12 analysts in the last year, the consensus rating for Palantir Technologies stock is Hold based on the current 2 sell ratings, 6 hold ratings, 3 buy ratings and 1 strong buy rating for PLTR.
Class A Stock - Short Squeeze, Borrow Rates.
Though the stock isn't significantly undervalued anymore, it still trades below analyst estimates, presenting a solid opportunity to pick it up at a discount. Palantir has transformed into a full enterprise software provider, enabling its customers to make critical operational decisions.
Who are Palantir competitors?
Palantir's top competitors include Tyler Technologies, Verint, Tableau Software, Splunk, Mu Sigma and Cognizant. Palantir Technologies is a company that provides software applications for integrating, visualizing, and analyzing information.
Palantir is a place where you meet a lot of talented people with excellent ideas, organizational skills and the company has a start-up work culture that encourages all the employees to contribute more ideas freely. It is an enthusiastic company to work with.
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Stocks.
| Price | 80.23 USD |
|---|---|
| Intrinsic Value | 69.23 USD |
Palantir Stock Looks Like Good Value At $9.
Spence Asset Management Buys PLTR Stock
The firm was not required to report its purchase price, although the purchase occurred sometime during Q1. In Q1, Palantir traded in a range between $9.75 and $18.53. After the purchase, Palantir is now Spence's ninth-largest position out of 35 total positions.
Growth Narrative
Per the company's Feb. 17 earnings report, “Annual revenue growth of 30% or greater through 2025” can be expected. And that's what the company is also telegraphing for the next quarter when it anticipates $443 million in revenues. The company posted $341 million in the first quarter of 2021.
PLTR Stock Was Down 55% For 2022
A software benchmark, the iShares Expanded Tech-Software ETF (IGV), has contracted 34% in 2022. Software growth stocks that traded at the highest multiples of forward-looking revenue, such as Palantir, have been the hardest hit.
With about 50-60 times the forward price to earnings ratio, toward the end of 2024 or at the beginning of 2025, it is likely for Palantir to be trading at about $71 to $85.8 billion market capitalization, creating a potential growth forecast of about 3 times in the midpoint from the current market capitalization.
Palantir stock rose 5.7% to close at 8.71 on the stock market today. BofA analyst Mariana Mora initiated coverage of PLTR stock with a buy rating and price target of 13.
Palantir Foundry deployed on AWS leverages core services such as Amazon Simple Storage Service (Amazon S3), Amazon Elastic Compute Cloud (Amazon EC2), Amazon EC2 Auto Scaling, Elastic Load Balancing (ELB), Amazon Relational Database Service (Amazon RDS), and AWS Key Management Service (AWS KMS) to provide a scalable ...
