Palantir: $50 Per Share Is Not Unreasonable

Seeking Alpha2023-11-17

Palantir, the enigmatic tech provider for the CIA and Department of Defense, has attracted significant investor interest since going public in 2021.The company is expensive, but it offers visionary ...

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Starlet
·2023-11-18
Agree! In fact it could be as high as snowflake!
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FGP
·2023-11-17
PLTR strong buy!!!!!!! 🤩
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The company's growth potential and profitability make it an attractive investment.Kevin Dietsch/Getty Images NewsAlmost no other company gets as much attention as Palantir (NYSE:PLTR) does these days.The enigmatic tech provider for the CIA and Department of Defense went public in 2021, and since then there's been an unbelievable amount of investor interest in the company, on both sides of the market.Some see the company, and its CEO, Alex Karp, as visionary. Others see the tech firm as an overblown, speculative venture that dilutes its shareholders to no end and hasn't earned a substantial profit in over 20 years.In some sense, both sides are right. The company is expensive nominally at over 19x revenue, and PLTR only just recently turned a positive TTM profit - it's first since the company's founding. The diluted share count also continues to grow, as free cash flow has been strong, but real, net profits have been elusive.However, while there are some issues, the company produces a visionary, mission critical product to an entrenched (and growing) customer base.It's three main products, Gotham, Foundry, and Apollo power government and commercial clients to do more with less, all while streamlining operations and decision making across an organization.Plus, it's new 'AIP', or Artificial Intelligence Platform, stands to further bolster PLTR's suite of products. Given that PLTR's whole mission is to empower organizations to use their data better, LLM interfacing seems like it could be a serious value add for corporations as well as modern warfighters and intelligence gathering organizations.In our view, despite the aforementioned concerns, it seems as though Palantir (and it's stock) could be in the early innings of a serious run.Today, we're going to take a deeper look into PLTR, its prospects, and its valuation to determine whether or not the company is worth your hard-earned capital.Sound good? Let's jump in!FinancialsAs always, let's start with the company's financial results.In short, PLTR is growing, and beginning to turn the corner on profitability.In their recent Q3 report, PLTR reported $0.07 in EPS, along with $558 million in revenue, both of which came in above expectations:Seeking AlphaYear-over-year revenue growth came in at ~17%, which was a slight pickup from the quarter prior, and remains well above index - and industry - averages.Looking at the income statement, the company reported higher revenue as discussed, but was able to keep the revenue-related-costs the same, which translated to much higher gross margins YoY:10QWhen combined with slightly lower operating expenses at $410 million vs. $432 million a year prior, PLTR has clearly done a good job of managing costs within the business.These COGS and OpEx improvements translate to a nearly $100 million swing in YoY operating income, from red to black.When adding in the impact of higher rates, more treasuries on the balance sheet, and an improved liability profile, operating to net adjustments further accentuate how far the company has come in a few short quarters: a $122 million loss in last year's Q3, to an ~$80 million profit in this year's.If you remove the $114 million in stock-based compensation, the picture only improves further.Zooming out somewhat, the company has done a good job when it comes to net revenue retention and growth. TTM sales continue to increase like clockwork off of the back of the company's strong product suite, and AIP in particular:TradingViewHere's what management had to say about the continued growth:In Q3, we closed 80 deals of $1 million or more across 30 industries, 29 deals of $5 million or more across 16 industries, and 12 deals of $10 million or more across 11 industries.Our U.S. commercial business accelerated last quarter, growing 33% year-over-year. Excluding strategic commercial contracts, it grew 52% year-over-year and 19% sequentially, and three-fourths of our quarter-over-quarter growth is from customers that started with us in 2023. Our U.S. commercial customer count rose 12% quarter-over-quarter and is now ten-fold what it was just three years ago.Deal count for our U.S. commercial business is 2.4x what it was in Q3 of last year and U.S. commercial TCV closed at $252 million, up 55% year-over-year on a dollar-weighted duration basis. We're also seeing the acceleration of larger deals and shorter times to conversion and expansion, including a multiyear deal in excess of $40 million with one of the largest home construction companies in the U.S. to start up pilot and converted all within Q3.This growth is in part due to AIP's continued transformation of the way we partner with and deliver value for our customers, and we expect AIP's impact to continue to intensify. The rapid expansion of AIP at both our existing and new customers, and the impact it is having on their operations is nothing short of remarkable.Naturally, this growth wouldn't matter if customers were churning. However, with a NRR figure of 107%, it's clear that isn't happening.The ValuationCritics say that PLTR is expensive, and it's true. Trading at just over 19 times sales, PLTR's improving profitability and continued growth demand quite a premium in today's market:TradingViewFor reference, Apple (AAPL), perhaps the most well-known, profitable company of this century, trades at around 7.6x sales.That said, the company is trading at a relative bargain vs. where it was in the low interest rate era in 2021, and with real profits to fall back on, the present valuation seems far more palatable.From another angle, PLTR reminds us of ServiceNow (NOW) in 2018/2019. At that time, NOW was still unprofitable and around the same level in terms of TTM revenue. The company was also still diluting shareholders significantly, and the valuation, at ~16x sales, was expensive.However, as that company has grown and the multiples have remained consistent, NOW's stock has increased substantially, more than tripling over that time:TradingViewYou can see how NOW's top line multiple is still trading where it was 5 years ago or so:TradingViewWe think the same thing could happen to PLTR.Common investing maxims often suggest that one of the best times to get involved in a stock is when a company growing top line sales begins to swing from lossmaking to profitability, as PLTR is doing now.Despite the monster 200%+ rally that PLTR has seen YTD, we think there's still gas left in the tank as the company continues pushing on all fronts:TradingViewRight now, PLTR trades at 8x 2022 revenue estimates:Seeking AlphaShould the multiple remain constant through that period, then that would imply a 2027 market cap between $95-$105 billion. Extrapolating out today's price and market cap, that suggests that the stock could more than double to a target around $50.This model does factor in a consistent supply of shares over time, which PLTR has not been capable of maintaining:TradingViewThat said, as the company grows and becomes more profitable, we suspect that the company will dilute less. It may even be in the position, in a few years' time, where it looks to begin a buyback similar to the one NOW just instituted.Either way, we think there's potential for the underlying stock to soar on the back of a sustained premium multiple and strong underlying growth and profitability.RisksWhile we like where PLTR is potentially headed, there are plenty of risks that investors should be aware of when it comes to investing in PLTR stock for the long haul. Here are a few key things to keep in mind:Dependence on Government Contracts: A significant portion of PLTR's revenue comes from government contracts, particularly from defense and intelligence agencies. This reliance makes the company vulnerable to changes in government spending, policy shifts, and political climates. That said, after working its way into being a trusted defense procurement company, it seems unlikely that it would be dropped without significant warning.Competitive Market and Technological Changes: The field of data analytics and big data is highly competitive, with many players vying for market share. PLTR operates in an environment where rapid technological advancements are common. While the company has done a good job of staying ahead up to this point, there's always a concern that a competitor could disrupt PLTR's commercial offerings, which could mean a serious dent in revenue.Reputation and Privacy Concerns: PLTR's work, particularly with government agencies, has raised concerns around data privacy and ethical use of its technology. Any negative publicity or backlash could impact its business relationships and brand image, potentially leading to lost contracts or legal challenges.Complexity of the Platform: PLTR's platforms, like Gotham and Foundry, are complex and require significant training and expertise to use effectively. This could limit adoption and growth.SummaryOverall, despite the risks, we like what we see when it comes to Palantir. The company's financials have never been in better shape, and the company's product remains sticky.If management can reduce dilution and the keep the results coming (and thus, the premium multiple), then we think it's possible that a price target of $50 per share within a few years is not unreasonable.We rate PLTR stock a \"Strong buy\".Cheers!","kind":null,"is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"0","news_tag":"","news_rank":0,"symbols":[],"gpt_button":1},"commentList":[{"id":242590880563296,"gmtCreate":1700263310586,"gmtModify":1700263315378,"author":{"id":"3565917743458670","authorId":"3565917743458670","name":"Starlet","avatar":"https://static.tigerbbs.com/8cb20dc6decfb7da73518abf145cbc3b","vip":1,"crmLevel":4,"crmLevelSwitch":0,"idStr":"3565917743458670","authorIdStr":"3565917743458670"},"htmlText":"Agree! In fact it could be as high as snowflake!&nbsp;","listText":"Agree! In fact it could be as high as snowflake!&nbsp;","text":"Agree! In fact it could be as high as snowflake!","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/242590880563296","repostId":2383849512,"repostType":2,"repost":{"id":"2383849512","pubTimestamp":1700187940,"share":"https://ttm.financial/m/news/2383849512?lang=&edition=fundamental","pubTime":"2023-11-17 10:25","market":"us","language":"en","title":"Palantir: $50 Per Share Is Not Unreasonable","url":"https://stock-news.laohu8.com/highlight/detail?id=2383849512","media":"Seeking Alpha","summary":"Financials As always, let's start with the company's financial results. In short, PLTR is growing, and beginning to turn the corner on profitability. In their recent Q3 report, PLTR reported $0.07 in EPS, along with $558 million in revenue, both of which came in above expectations: Seeking Alpha Year-over-year revenue growth came in at ~17%, which was a slight pickup from the quarter prior, and remains well above index - and industry - averages. Looking at the income statement, the company reported higher revenue as discussed, but was able to keep the revenue-related-costs the same, which translated to much higher gr","content":"<html><head></head><body><ul style=\"\"><li>Palantir, the enigmatic tech provider for the CIA and Department of Defense, has attracted significant investor interest since going public in 2021.</li><li>The company is expensive, but it offers visionary products that streamline operations and decision-making for government and commercial clients.</li><li>Palantir&#39;s financials are improving, with growing revenue, higher gross margins, and a swing from operating losses to profits. The company&#39;s growth potential and profitability make it an attractive investment.</li></ul><img src=\"https://static.tigerbbs.com/a54f10cd065f75e579c76768fae49b10\" alt=\"Kevin Dietsch/Getty Images News\" title=\"Kevin Dietsch/Getty Images News\" tg-width=\"750\" tg-height=\"509\"/>Kevin Dietsch/Getty Images NewsAlmost no other company gets as much attention as Palantir (NYSE:PLTR) does these days.The enigmatic tech provider for the CIA and Department of Defense went public in 2021, and since then there&#39;s been an unbelievable amount of investor interest in the company, on both sides of the market.Some see the company, and its CEO, Alex Karp, as visionary. Others see the tech firm as an overblown, speculative venture that dilutes its shareholders to no end and hasn&#39;t earned a substantial profit in over 20 years.In some sense, both sides are right. The company is expensive nominally at over 19x revenue, and PLTR only just recently turned a positive TTM profit - it&#39;s first since the company&#39;s founding. The diluted share count also continues to grow, as free cash flow has been strong, but real, net profits have been elusive.However, while there are some issues, the company produces a visionary, mission critical product to an entrenched (and growing) customer base.It&#39;s three main products, Gotham, Foundry, and Apollo power government and commercial clients to do more with less, all while streamlining operations and decision making across an organization.Plus, it&#39;s new &#39;AIP&#39;, or Artificial Intelligence Platform, stands to further bolster PLTR&#39;s suite of products. Given that PLTR&#39;s whole mission is to empower organizations to use their data better, LLM interfacing seems like it could be a serious value add for corporations as well as modern warfighters and intelligence gathering organizations.In our view, despite the aforementioned concerns, it seems as though Palantir (and it&#39;s stock) could be in the early innings of a serious run.Today, we&#39;re going to take a deeper look into PLTR, its prospects, and its valuation to determine whether or not the company is worth your hard-earned capital.Sound good? Let&#39;s jump in!<h2 id=\"id_2151870192\">Financials</h2>As always, let&#39;s start with the company&#39;s financial results.In short, PLTR is growing, and beginning to turn the corner on profitability.In their recent Q3 report, PLTR reported $0.07 in EPS, along with $558 million in revenue, both of which came in above expectations:<img src=\"https://static.tigerbbs.com/64343727b767aa851e54a23edc3c9539\" alt=\"Seeking Alpha\" title=\"Seeking Alpha\" tg-width=\"640\" tg-height=\"264\"/>Seeking AlphaYear-over-year revenue growth came in at ~17%, which was a slight pickup from the quarter prior, and remains well above index - and industry - averages.Looking at the income statement, the company reported higher revenue as discussed, but was able to keep the revenue-related-costs the same, which translated to much higher gross margins YoY:<img src=\"https://static.tigerbbs.com/c4609b6d2c7c5e1f8ba33c6588d2e52f\" alt=\"10Q\" title=\"10Q\" tg-width=\"640\" tg-height=\"261\"/>10QWhen combined with slightly lower operating expenses at $410 million vs. $432 million a year prior, PLTR has clearly done a good job of managing costs within the business.These COGS and OpEx improvements translate to a nearly $100 million swing in YoY operating income, from red to black.When adding in the impact of higher rates, more treasuries on the balance sheet, and an improved liability profile, operating to net adjustments further accentuate how far the company has come in a few short quarters: a $122 million loss in last year&#39;s Q3, to an ~$80 million profit in this year&#39;s.If you remove the $114 million in stock-based compensation, the picture only improves further.Zooming out somewhat, the company has done a good job when it comes to net revenue retention and growth. TTM sales continue to increase like clockwork off of the back of the company&#39;s strong product suite, and AIP in particular:<img src=\"https://static.tigerbbs.com/ef4f4c31bc88b61c28390af8cfa41828\" alt=\"TradingView\" title=\"TradingView\" tg-width=\"640\" tg-height=\"549\"/>TradingViewHere&#39;s what management had to say about the continued growth:<blockquote>In Q3, we closed 80 deals of $1 million or more across 30 industries, 29 deals of $5 million or more across 16 industries, and 12 deals of $10 million or more across 11 industries.Our U.S. commercial business accelerated last quarter, growing 33% year-over-year. Excluding strategic commercial contracts, it grew 52% year-over-year and 19% sequentially, and three-fourths of our quarter-over-quarter growth is from customers that started with us in 2023. Our U.S. commercial customer count rose 12% quarter-over-quarter and is now ten-fold what it was just three years ago.Deal count for our U.S. commercial business is 2.4x what it was in Q3 of last year and U.S. commercial TCV closed at $252 million, up 55% year-over-year on a dollar-weighted duration basis. We&#39;re also seeing the acceleration of larger deals and shorter times to conversion and expansion, including a multiyear deal in excess of $40 million with one of the largest home construction companies in the U.S. to start up pilot and converted all within Q3.This growth is in part due to AIP&#39;s continued transformation of the way we partner with and deliver value for our customers, and we expect AIP&#39;s impact to continue to intensify. The rapid expansion of AIP at both our existing and new customers, and the impact it is having on their operations is nothing short of remarkable.</blockquote>Naturally, this growth wouldn&#39;t matter if customers were churning. However, with a NRR figure of 107%, it&#39;s clear that isn&#39;t happening.<h2 id=\"id_4065639564\">The Valuation</h2>Critics say that PLTR is expensive, and it&#39;s true. Trading at just over 19 times sales, PLTR&#39;s improving profitability and continued growth demand quite a premium in today&#39;s market:<img src=\"https://static.tigerbbs.com/833ccbdce0ab4b2fcc84b5bb5303a3cc\" alt=\"TradingView\" title=\"TradingView\" tg-width=\"640\" tg-height=\"549\"/>TradingViewFor reference, Apple (AAPL), perhaps the most well-known, profitable company of this century, trades at around 7.6x sales.That said, the company is trading at a relative bargain vs. where it was in the low interest rate era in 2021, and with real profits to fall back on, the present valuation seems far more palatable.From another angle, PLTR reminds us of <a href=\"https://laohu8.com/S/NOW\">ServiceNow</a> (NOW) in 2018/2019. At that time, NOW was still unprofitable and around the same level in terms of TTM revenue. The company was also still diluting shareholders significantly, and the valuation, at ~16x sales, was expensive.However, as that company has grown and the multiples have remained consistent, NOW&#39;s stock has increased substantially, more than tripling over that time:<img src=\"https://static.tigerbbs.com/1d27f552c153494ae33d148f77e52114\" alt=\"TradingView\" title=\"TradingView\" tg-width=\"640\" tg-height=\"549\"/>TradingViewYou can see how NOW&#39;s top line multiple is still trading where it was 5 years ago or so:<img src=\"https://static.tigerbbs.com/495e99eb77b480fc78c5c9c02b43f784\" alt=\"TradingView\" title=\"TradingView\" tg-width=\"640\" tg-height=\"549\"/>TradingViewWe think the same thing could happen to PLTR.Common investing maxims often suggest that one of the best times to get involved in a stock is when a company growing top line sales begins to swing from lossmaking to profitability, as PLTR is doing now.Despite the monster 200%+ rally that PLTR has seen YTD, we think there&#39;s still gas left in the tank as the company continues pushing on all fronts:<img src=\"https://static.tigerbbs.com/87dd33ad11c80d802f2472bd0c0c6fe1\" alt=\"TradingView\" title=\"TradingView\" tg-width=\"640\" tg-height=\"549\"/>TradingViewRight now, PLTR trades at 8x 2022 revenue estimates:<img src=\"https://static.tigerbbs.com/078d9aa707cb486ee3225f10d9675028\" alt=\"Seeking Alpha\" title=\"Seeking Alpha\" tg-width=\"640\" tg-height=\"349\"/>Seeking AlphaShould the multiple remain constant through that period, then that would imply a 2027 market cap between $95-$105 billion. Extrapolating out today&#39;s price and market cap, that suggests that the stock could more than double to a target around $50.This model does factor in a consistent supply of shares over time, which PLTR has not been capable of maintaining:<img src=\"https://static.tigerbbs.com/d0cfad784a559d40ec32069338962843\" alt=\"TradingView\" title=\"TradingView\" tg-width=\"640\" tg-height=\"549\"/>TradingViewThat said, as the company grows and becomes more profitable, we suspect that the company will dilute less. It may even be in the position, in a few years&#39; time, where it looks to begin a buyback similar to the one NOW just instituted.Either way, we think there&#39;s potential for the underlying stock to soar on the back of a sustained premium multiple and strong underlying growth and profitability.<h2 id=\"id_3871629608\">Risks</h2>While we like where PLTR is potentially headed, there are plenty of risks that investors should be aware of when it comes to investing in PLTR stock for the long haul. Here are a few key things to keep in mind:Dependence on Government Contracts: A significant portion of PLTR&#39;s revenue comes from government contracts, particularly from defense and intelligence agencies. This reliance makes the company vulnerable to changes in government spending, policy shifts, and political climates. That said, after working its way into being a trusted defense procurement company, it seems unlikely that it would be dropped without significant warning.Competitive Market and Technological Changes: The field of data analytics and big data is highly competitive, with many players vying for market share. PLTR operates in an environment where rapid technological advancements are common. While the company has done a good job of staying ahead up to this point, there&#39;s always a concern that a competitor could disrupt PLTR&#39;s commercial offerings, which could mean a serious dent in revenue.Reputation and Privacy Concerns: PLTR&#39;s work, particularly with government agencies, has raised concerns around data privacy and ethical use of its technology. Any negative publicity or backlash could impact its business relationships and brand image, potentially leading to lost contracts or legal challenges.Complexity of the Platform: PLTR&#39;s platforms, like Gotham and Foundry, are complex and require significant training and expertise to use effectively. This could limit adoption and growth.<h2 id=\"id_2155957031\">Summary</h2>Overall, despite the risks, we like what we see when it comes to Palantir. The company&#39;s financials have never been in better shape, and the company&#39;s product remains sticky.If management can reduce dilution and the keep the results coming (and thus, the premium multiple), then we think it&#39;s possible that a price target of $50 per share within a few years is not unreasonable.We rate PLTR stock a &#34;Strong buy&#34;.Cheers!</body></html>","source":"seekingalpha","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Palantir: $50 Per Share Is Not Unreasonable</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; 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}\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nPalantir: $50 Per Share Is Not Unreasonable\n</h2>\n\n<h4 class=\"meta\">\n\n\n2023-11-17 10:25 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4652276-palantir-50-per-share-is-not-unreasonable>Seeking Alpha</a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\nPalantir, the enigmatic tech provider for the CIA and Department of Defense, has attracted significant investor interest since going public in 2021.The company is expensive, but it offers visionary ...\n\n<a href=\"https://seekingalpha.com/article/4652276-palantir-50-per-share-is-not-unreasonable\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"IE00BJJMRX11.SGD":"Janus Henderson Balanced A Acc SGD","IE00BJTD4V19.USD":"NEUBERGER BERMAN US LONG SHORT EQUITY \"A1\" (USD) ACC","LU0889565833.HKD":"FRANKLIN TECHNOLOGY \"A\" (HKD) ACC","LU0170899867.USD":"EASTSPRING INVESTMENTS WORLD VALUE EQUITY \"A\" (USD) ACC","BK4097":"系统软件","LU1551013342.USD":"Allianz Income and Growth Cl AMg2 DIS USD","BK4512":"苹果概念","LU0056508442.USD":"贝莱德世界科技基金A2","LU1803068979.SGD":"FTIF - Franklin Technology A (acc) SGD-H1","IE00B1XK9C88.USD":"PINEBRIDGE US LARGE CAP RESEARCH ENHANCED \"A\" (USD) ACC","LU0353189680.USD":"富国美国全盘成长基金Cl A Acc","IE00BJJMRY28.SGD":"Janus Henderson Balanced A Inc SGD","LU0820561909.HKD":"ALLIANZ INCOME AND GROWTH \"AM\" (HKD) INC","LU0109392836.USD":"富兰克林科技股A","IE0004445239.USD":"JANUS HENDERSON US FORTY \"A2\" (USD) ACC","IE0004445015.USD":"JANUS HENDERSON BALANCED \"A2\" (USD) ACC","LU0011850046.USD":"贝莱德全球长线股票 A2 USD","BK4532":"文艺复兴科技持仓","BK4554":"元宇宙及AR概念","BK4515":"5G概念","LU0097036916.USD":"贝莱德美国增长A2 USD","LU0466842654.USD":"HSBC ISLAMIC GLOBAL EQUITY INDEX \"A\" (USD) ACC","LU0689472784.USD":"安联收益及增长基金Cl AM AT Acc","BK4553":"喜马拉雅资本持仓","BK4534":"瑞士信贷持仓","LU0289961442.SGD":"SUSTAINABLE GLOBAL THEMATIC PORTFOLIO \"AX\" (SGD) ACC","PLTR":"Palantir Technologies Inc.","BK4533":"AQR资本管理(全球第二大对冲基金)","LU0820561818.USD":"安联收益及增长平衡基金Cl AM DIS","BK4566":"资本集团","LU0149725797.USD":"汇丰美国股市经济规模基金","LU0354030511.USD":"ALLSPRING U.S. LARGE CAP GROWTH \"I\" (USD) ACC","IE00BKVL7J92.USD":"Legg Mason ClearBridge - US Equity Sustainability Leaders A Acc USD","LU1551013425.SGD":"Allianz Income and Growth Cl AMg2 DIS H2-SGD","LU0354030438.USD":"富国美国大盘成长基金Cl A Acc","LU1989764748.USD":"东方汇理环球颠覆性机遇A2 Acc","LU0127658192.USD":"EASTSPRING INVESTMENTS GLOBAL TECHNOLOGY \"A\" (USD) ACC","LU0256863811.USD":"ALLIANZ US EQUITY \"A\" INC","IE00BJTD4N35.SGD":"Neuberger Berman US Long Short Equity A1 Acc SGD-H","LU1989764664.SGD":"CPR Invest - Global Disruptive Opportunities A2 Acc SGD-H","BK4559":"巴菲特持仓","LU0289739343.SGD":"SUSTAINABLE GLOBAL THEMATIC PORTFOLIO \"A\" (SGD) ACC","BK4550":"红杉资本持仓","LU2458330169.SGD":"FRANKLIN SHARIAH TECHNOLOGY \"A\" (SGD) ACC","IE00B775SV38.USD":"NEUBERGER BERMAN US MULTICAP OPPORTUNITIES \"A\" (USD) ACC","LU0943347566.SGD":"安联收益及增长平衡基金AM H2-SGD","IE00B3S45H60.SGD":"Neuberger Berman US Multicap Opportunities A Acc SGD-H","LU2458330243.SGD":"FRANKLIN SHARIAH TECHNOLOGY \"A-H1\" (SGDHDG) ACC"},"source_url":"https://seekingalpha.com/article/4652276-palantir-50-per-share-is-not-unreasonable","is_english":true,"share_image_url":"https://static.laohu8.com/5a36db9d73b4222bc376d24ccc48c8a4","article_id":"2383849512","content_text":"Palantir, the enigmatic tech provider for the CIA and Department of Defense, has attracted significant investor interest since going public in 2021.The company is expensive, but it offers visionary products that streamline operations and decision-making for government and commercial clients.Palantir's financials are improving, with growing revenue, higher gross margins, and a swing from operating losses to profits. The company's growth potential and profitability make it an attractive investment.Kevin Dietsch/Getty Images NewsAlmost no other company gets as much attention as Palantir (NYSE:PLTR) does these days.The enigmatic tech provider for the CIA and Department of Defense went public in 2021, and since then there's been an unbelievable amount of investor interest in the company, on both sides of the market.Some see the company, and its CEO, Alex Karp, as visionary. Others see the tech firm as an overblown, speculative venture that dilutes its shareholders to no end and hasn't earned a substantial profit in over 20 years.In some sense, both sides are right. The company is expensive nominally at over 19x revenue, and PLTR only just recently turned a positive TTM profit - it's first since the company's founding. The diluted share count also continues to grow, as free cash flow has been strong, but real, net profits have been elusive.However, while there are some issues, the company produces a visionary, mission critical product to an entrenched (and growing) customer base.It's three main products, Gotham, Foundry, and Apollo power government and commercial clients to do more with less, all while streamlining operations and decision making across an organization.Plus, it's new 'AIP', or Artificial Intelligence Platform, stands to further bolster PLTR's suite of products. Given that PLTR's whole mission is to empower organizations to use their data better, LLM interfacing seems like it could be a serious value add for corporations as well as modern warfighters and intelligence gathering organizations.In our view, despite the aforementioned concerns, it seems as though Palantir (and it's stock) could be in the early innings of a serious run.Today, we're going to take a deeper look into PLTR, its prospects, and its valuation to determine whether or not the company is worth your hard-earned capital.Sound good? Let's jump in!FinancialsAs always, let's start with the company's financial results.In short, PLTR is growing, and beginning to turn the corner on profitability.In their recent Q3 report, PLTR reported $0.07 in EPS, along with $558 million in revenue, both of which came in above expectations:Seeking AlphaYear-over-year revenue growth came in at ~17%, which was a slight pickup from the quarter prior, and remains well above index - and industry - averages.Looking at the income statement, the company reported higher revenue as discussed, but was able to keep the revenue-related-costs the same, which translated to much higher gross margins YoY:10QWhen combined with slightly lower operating expenses at $410 million vs. $432 million a year prior, PLTR has clearly done a good job of managing costs within the business.These COGS and OpEx improvements translate to a nearly $100 million swing in YoY operating income, from red to black.When adding in the impact of higher rates, more treasuries on the balance sheet, and an improved liability profile, operating to net adjustments further accentuate how far the company has come in a few short quarters: a $122 million loss in last year's Q3, to an ~$80 million profit in this year's.If you remove the $114 million in stock-based compensation, the picture only improves further.Zooming out somewhat, the company has done a good job when it comes to net revenue retention and growth. TTM sales continue to increase like clockwork off of the back of the company's strong product suite, and AIP in particular:TradingViewHere's what management had to say about the continued growth:In Q3, we closed 80 deals of $1 million or more across 30 industries, 29 deals of $5 million or more across 16 industries, and 12 deals of $10 million or more across 11 industries.Our U.S. commercial business accelerated last quarter, growing 33% year-over-year. Excluding strategic commercial contracts, it grew 52% year-over-year and 19% sequentially, and three-fourths of our quarter-over-quarter growth is from customers that started with us in 2023. Our U.S. commercial customer count rose 12% quarter-over-quarter and is now ten-fold what it was just three years ago.Deal count for our U.S. commercial business is 2.4x what it was in Q3 of last year and U.S. commercial TCV closed at $252 million, up 55% year-over-year on a dollar-weighted duration basis. We're also seeing the acceleration of larger deals and shorter times to conversion and expansion, including a multiyear deal in excess of $40 million with one of the largest home construction companies in the U.S. to start up pilot and converted all within Q3.This growth is in part due to AIP's continued transformation of the way we partner with and deliver value for our customers, and we expect AIP's impact to continue to intensify. The rapid expansion of AIP at both our existing and new customers, and the impact it is having on their operations is nothing short of remarkable.Naturally, this growth wouldn't matter if customers were churning. However, with a NRR figure of 107%, it's clear that isn't happening.The ValuationCritics say that PLTR is expensive, and it's true. Trading at just over 19 times sales, PLTR's improving profitability and continued growth demand quite a premium in today's market:TradingViewFor reference, Apple (AAPL), perhaps the most well-known, profitable company of this century, trades at around 7.6x sales.That said, the company is trading at a relative bargain vs. where it was in the low interest rate era in 2021, and with real profits to fall back on, the present valuation seems far more palatable.From another angle, PLTR reminds us of ServiceNow (NOW) in 2018/2019. At that time, NOW was still unprofitable and around the same level in terms of TTM revenue. The company was also still diluting shareholders significantly, and the valuation, at ~16x sales, was expensive.However, as that company has grown and the multiples have remained consistent, NOW's stock has increased substantially, more than tripling over that time:TradingViewYou can see how NOW's top line multiple is still trading where it was 5 years ago or so:TradingViewWe think the same thing could happen to PLTR.Common investing maxims often suggest that one of the best times to get involved in a stock is when a company growing top line sales begins to swing from lossmaking to profitability, as PLTR is doing now.Despite the monster 200%+ rally that PLTR has seen YTD, we think there's still gas left in the tank as the company continues pushing on all fronts:TradingViewRight now, PLTR trades at 8x 2022 revenue estimates:Seeking AlphaShould the multiple remain constant through that period, then that would imply a 2027 market cap between $95-$105 billion. Extrapolating out today's price and market cap, that suggests that the stock could more than double to a target around $50.This model does factor in a consistent supply of shares over time, which PLTR has not been capable of maintaining:TradingViewThat said, as the company grows and becomes more profitable, we suspect that the company will dilute less. It may even be in the position, in a few years' time, where it looks to begin a buyback similar to the one NOW just instituted.Either way, we think there's potential for the underlying stock to soar on the back of a sustained premium multiple and strong underlying growth and profitability.RisksWhile we like where PLTR is potentially headed, there are plenty of risks that investors should be aware of when it comes to investing in PLTR stock for the long haul. Here are a few key things to keep in mind:Dependence on Government Contracts: A significant portion of PLTR's revenue comes from government contracts, particularly from defense and intelligence agencies. This reliance makes the company vulnerable to changes in government spending, policy shifts, and political climates. That said, after working its way into being a trusted defense procurement company, it seems unlikely that it would be dropped without significant warning.Competitive Market and Technological Changes: The field of data analytics and big data is highly competitive, with many players vying for market share. PLTR operates in an environment where rapid technological advancements are common. While the company has done a good job of staying ahead up to this point, there's always a concern that a competitor could disrupt PLTR's commercial offerings, which could mean a serious dent in revenue.Reputation and Privacy Concerns: PLTR's work, particularly with government agencies, has raised concerns around data privacy and ethical use of its technology. Any negative publicity or backlash could impact its business relationships and brand image, potentially leading to lost contracts or legal challenges.Complexity of the Platform: PLTR's platforms, like Gotham and Foundry, are complex and require significant training and expertise to use effectively. This could limit adoption and growth.SummaryOverall, despite the risks, we like what we see when it comes to Palantir. The company's financials have never been in better shape, and the company's product remains sticky.If management can reduce dilution and the keep the results coming (and thus, the premium multiple), then we think it's possible that a price target of $50 per share within a few years is not unreasonable.We rate PLTR stock a \"Strong buy\".Cheers!","news_type":1},"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"langContent":"EN"},{"id":242309489623264,"gmtCreate":1700194614277,"gmtModify":1700194618548,"author":{"id":"3584079457608282","authorId":"3584079457608282","name":"FGP","avatar":"https://community-static.tradeup.com/news/4f96275867e9fcc09f90747c0edcd143","vip":1,"hat":"https://static.tigerbbs.com/a3dee1aa3a3a3c1814833a4d3f8a5669","crmLevel":9,"crmLevelSwitch":1,"idStr":"3584079457608282","authorIdStr":"3584079457608282"},"htmlText":"PLTR strong buy!!!!!!! 🤩","listText":"PLTR strong buy!!!!!!! 🤩","text":"PLTR strong buy!!!!!!! 🤩","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":3,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/242309489623264","repostId":2383849512,"repostType":4,"repost":{"id":"2383849512","pubTimestamp":1700187940,"share":"https://ttm.financial/m/news/2383849512?lang=&edition=fundamental","pubTime":"2023-11-17 10:25","market":"us","language":"en","title":"Palantir: $50 Per Share Is Not Unreasonable","url":"https://stock-news.laohu8.com/highlight/detail?id=2383849512","media":"Seeking Alpha","summary":"Financials As always, let's start with the company's financial results. In short, PLTR is growing, and beginning to turn the corner on profitability. In their recent Q3 report, PLTR reported $0.07 in EPS, along with $558 million in revenue, both of which came in above expectations: Seeking Alpha Year-over-year revenue growth came in at ~17%, which was a slight pickup from the quarter prior, and remains well above index - and industry - averages. Looking at the income statement, the company reported higher revenue as discussed, but was able to keep the revenue-related-costs the same, which translated to much higher gr","content":"<html><head></head><body><ul style=\"\"><li>Palantir, the enigmatic tech provider for the CIA and Department of Defense, has attracted significant investor interest since going public in 2021.</li><li>The company is expensive, but it offers visionary products that streamline operations and decision-making for government and commercial clients.</li><li>Palantir&#39;s financials are improving, with growing revenue, higher gross margins, and a swing from operating losses to profits. The company&#39;s growth potential and profitability make it an attractive investment.</li></ul><img src=\"https://static.tigerbbs.com/a54f10cd065f75e579c76768fae49b10\" alt=\"Kevin Dietsch/Getty Images News\" title=\"Kevin Dietsch/Getty Images News\" tg-width=\"750\" tg-height=\"509\"/>Kevin Dietsch/Getty Images NewsAlmost no other company gets as much attention as Palantir (NYSE:PLTR) does these days.The enigmatic tech provider for the CIA and Department of Defense went public in 2021, and since then there&#39;s been an unbelievable amount of investor interest in the company, on both sides of the market.Some see the company, and its CEO, Alex Karp, as visionary. Others see the tech firm as an overblown, speculative venture that dilutes its shareholders to no end and hasn&#39;t earned a substantial profit in over 20 years.In some sense, both sides are right. The company is expensive nominally at over 19x revenue, and PLTR only just recently turned a positive TTM profit - it&#39;s first since the company&#39;s founding. The diluted share count also continues to grow, as free cash flow has been strong, but real, net profits have been elusive.However, while there are some issues, the company produces a visionary, mission critical product to an entrenched (and growing) customer base.It&#39;s three main products, Gotham, Foundry, and Apollo power government and commercial clients to do more with less, all while streamlining operations and decision making across an organization.Plus, it&#39;s new &#39;AIP&#39;, or Artificial Intelligence Platform, stands to further bolster PLTR&#39;s suite of products. Given that PLTR&#39;s whole mission is to empower organizations to use their data better, LLM interfacing seems like it could be a serious value add for corporations as well as modern warfighters and intelligence gathering organizations.In our view, despite the aforementioned concerns, it seems as though Palantir (and it&#39;s stock) could be in the early innings of a serious run.Today, we&#39;re going to take a deeper look into PLTR, its prospects, and its valuation to determine whether or not the company is worth your hard-earned capital.Sound good? Let&#39;s jump in!<h2 id=\"id_2151870192\">Financials</h2>As always, let&#39;s start with the company&#39;s financial results.In short, PLTR is growing, and beginning to turn the corner on profitability.In their recent Q3 report, PLTR reported $0.07 in EPS, along with $558 million in revenue, both of which came in above expectations:<img src=\"https://static.tigerbbs.com/64343727b767aa851e54a23edc3c9539\" alt=\"Seeking Alpha\" title=\"Seeking Alpha\" tg-width=\"640\" tg-height=\"264\"/>Seeking AlphaYear-over-year revenue growth came in at ~17%, which was a slight pickup from the quarter prior, and remains well above index - and industry - averages.Looking at the income statement, the company reported higher revenue as discussed, but was able to keep the revenue-related-costs the same, which translated to much higher gross margins YoY:<img src=\"https://static.tigerbbs.com/c4609b6d2c7c5e1f8ba33c6588d2e52f\" alt=\"10Q\" title=\"10Q\" tg-width=\"640\" tg-height=\"261\"/>10QWhen combined with slightly lower operating expenses at $410 million vs. $432 million a year prior, PLTR has clearly done a good job of managing costs within the business.These COGS and OpEx improvements translate to a nearly $100 million swing in YoY operating income, from red to black.When adding in the impact of higher rates, more treasuries on the balance sheet, and an improved liability profile, operating to net adjustments further accentuate how far the company has come in a few short quarters: a $122 million loss in last year&#39;s Q3, to an ~$80 million profit in this year&#39;s.If you remove the $114 million in stock-based compensation, the picture only improves further.Zooming out somewhat, the company has done a good job when it comes to net revenue retention and growth. TTM sales continue to increase like clockwork off of the back of the company&#39;s strong product suite, and AIP in particular:<img src=\"https://static.tigerbbs.com/ef4f4c31bc88b61c28390af8cfa41828\" alt=\"TradingView\" title=\"TradingView\" tg-width=\"640\" tg-height=\"549\"/>TradingViewHere&#39;s what management had to say about the continued growth:<blockquote>In Q3, we closed 80 deals of $1 million or more across 30 industries, 29 deals of $5 million or more across 16 industries, and 12 deals of $10 million or more across 11 industries.Our U.S. commercial business accelerated last quarter, growing 33% year-over-year. Excluding strategic commercial contracts, it grew 52% year-over-year and 19% sequentially, and three-fourths of our quarter-over-quarter growth is from customers that started with us in 2023. Our U.S. commercial customer count rose 12% quarter-over-quarter and is now ten-fold what it was just three years ago.Deal count for our U.S. commercial business is 2.4x what it was in Q3 of last year and U.S. commercial TCV closed at $252 million, up 55% year-over-year on a dollar-weighted duration basis. We&#39;re also seeing the acceleration of larger deals and shorter times to conversion and expansion, including a multiyear deal in excess of $40 million with one of the largest home construction companies in the U.S. to start up pilot and converted all within Q3.This growth is in part due to AIP&#39;s continued transformation of the way we partner with and deliver value for our customers, and we expect AIP&#39;s impact to continue to intensify. The rapid expansion of AIP at both our existing and new customers, and the impact it is having on their operations is nothing short of remarkable.</blockquote>Naturally, this growth wouldn&#39;t matter if customers were churning. However, with a NRR figure of 107%, it&#39;s clear that isn&#39;t happening.<h2 id=\"id_4065639564\">The Valuation</h2>Critics say that PLTR is expensive, and it&#39;s true. Trading at just over 19 times sales, PLTR&#39;s improving profitability and continued growth demand quite a premium in today&#39;s market:<img src=\"https://static.tigerbbs.com/833ccbdce0ab4b2fcc84b5bb5303a3cc\" alt=\"TradingView\" title=\"TradingView\" tg-width=\"640\" tg-height=\"549\"/>TradingViewFor reference, Apple (AAPL), perhaps the most well-known, profitable company of this century, trades at around 7.6x sales.That said, the company is trading at a relative bargain vs. where it was in the low interest rate era in 2021, and with real profits to fall back on, the present valuation seems far more palatable.From another angle, PLTR reminds us of <a href=\"https://laohu8.com/S/NOW\">ServiceNow</a> (NOW) in 2018/2019. At that time, NOW was still unprofitable and around the same level in terms of TTM revenue. The company was also still diluting shareholders significantly, and the valuation, at ~16x sales, was expensive.However, as that company has grown and the multiples have remained consistent, NOW&#39;s stock has increased substantially, more than tripling over that time:<img src=\"https://static.tigerbbs.com/1d27f552c153494ae33d148f77e52114\" alt=\"TradingView\" title=\"TradingView\" tg-width=\"640\" tg-height=\"549\"/>TradingViewYou can see how NOW&#39;s top line multiple is still trading where it was 5 years ago or so:<img src=\"https://static.tigerbbs.com/495e99eb77b480fc78c5c9c02b43f784\" alt=\"TradingView\" title=\"TradingView\" tg-width=\"640\" tg-height=\"549\"/>TradingViewWe think the same thing could happen to PLTR.Common investing maxims often suggest that one of the best times to get involved in a stock is when a company growing top line sales begins to swing from lossmaking to profitability, as PLTR is doing now.Despite the monster 200%+ rally that PLTR has seen YTD, we think there&#39;s still gas left in the tank as the company continues pushing on all fronts:<img src=\"https://static.tigerbbs.com/87dd33ad11c80d802f2472bd0c0c6fe1\" alt=\"TradingView\" title=\"TradingView\" tg-width=\"640\" tg-height=\"549\"/>TradingViewRight now, PLTR trades at 8x 2022 revenue estimates:<img src=\"https://static.tigerbbs.com/078d9aa707cb486ee3225f10d9675028\" alt=\"Seeking Alpha\" title=\"Seeking Alpha\" tg-width=\"640\" tg-height=\"349\"/>Seeking AlphaShould the multiple remain constant through that period, then that would imply a 2027 market cap between $95-$105 billion. Extrapolating out today&#39;s price and market cap, that suggests that the stock could more than double to a target around $50.This model does factor in a consistent supply of shares over time, which PLTR has not been capable of maintaining:<img src=\"https://static.tigerbbs.com/d0cfad784a559d40ec32069338962843\" alt=\"TradingView\" title=\"TradingView\" tg-width=\"640\" tg-height=\"549\"/>TradingViewThat said, as the company grows and becomes more profitable, we suspect that the company will dilute less. It may even be in the position, in a few years&#39; time, where it looks to begin a buyback similar to the one NOW just instituted.Either way, we think there&#39;s potential for the underlying stock to soar on the back of a sustained premium multiple and strong underlying growth and profitability.<h2 id=\"id_3871629608\">Risks</h2>While we like where PLTR is potentially headed, there are plenty of risks that investors should be aware of when it comes to investing in PLTR stock for the long haul. Here are a few key things to keep in mind:Dependence on Government Contracts: A significant portion of PLTR&#39;s revenue comes from government contracts, particularly from defense and intelligence agencies. This reliance makes the company vulnerable to changes in government spending, policy shifts, and political climates. That said, after working its way into being a trusted defense procurement company, it seems unlikely that it would be dropped without significant warning.Competitive Market and Technological Changes: The field of data analytics and big data is highly competitive, with many players vying for market share. PLTR operates in an environment where rapid technological advancements are common. While the company has done a good job of staying ahead up to this point, there&#39;s always a concern that a competitor could disrupt PLTR&#39;s commercial offerings, which could mean a serious dent in revenue.Reputation and Privacy Concerns: PLTR&#39;s work, particularly with government agencies, has raised concerns around data privacy and ethical use of its technology. Any negative publicity or backlash could impact its business relationships and brand image, potentially leading to lost contracts or legal challenges.Complexity of the Platform: PLTR&#39;s platforms, like Gotham and Foundry, are complex and require significant training and expertise to use effectively. This could limit adoption and growth.<h2 id=\"id_2155957031\">Summary</h2>Overall, despite the risks, we like what we see when it comes to Palantir. The company&#39;s financials have never been in better shape, and the company&#39;s product remains sticky.If management can reduce dilution and the keep the results coming (and thus, the premium multiple), then we think it&#39;s possible that a price target of $50 per share within a few years is not unreasonable.We rate PLTR stock a &#34;Strong buy&#34;.Cheers!</body></html>","source":"seekingalpha","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Palantir: $50 Per Share Is Not Unreasonable</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; 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}\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nPalantir: $50 Per Share Is Not Unreasonable\n</h2>\n\n<h4 class=\"meta\">\n\n\n2023-11-17 10:25 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4652276-palantir-50-per-share-is-not-unreasonable>Seeking Alpha</a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\nPalantir, the enigmatic tech provider for the CIA and Department of Defense, has attracted significant investor interest since going public in 2021.The company is expensive, but it offers visionary ...\n\n<a href=\"https://seekingalpha.com/article/4652276-palantir-50-per-share-is-not-unreasonable\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"IE00BJJMRX11.SGD":"Janus Henderson Balanced A Acc SGD","IE00BJTD4V19.USD":"NEUBERGER BERMAN US LONG SHORT EQUITY \"A1\" (USD) ACC","LU0889565833.HKD":"FRANKLIN TECHNOLOGY \"A\" (HKD) ACC","LU0170899867.USD":"EASTSPRING INVESTMENTS WORLD VALUE EQUITY \"A\" (USD) ACC","BK4097":"系统软件","LU1551013342.USD":"Allianz Income and Growth Cl AMg2 DIS USD","BK4512":"苹果概念","LU0056508442.USD":"贝莱德世界科技基金A2","LU1803068979.SGD":"FTIF - Franklin Technology A (acc) SGD-H1","IE00B1XK9C88.USD":"PINEBRIDGE US LARGE CAP RESEARCH ENHANCED \"A\" (USD) ACC","LU0353189680.USD":"富国美国全盘成长基金Cl A Acc","IE00BJJMRY28.SGD":"Janus Henderson Balanced A Inc SGD","LU0820561909.HKD":"ALLIANZ INCOME AND GROWTH \"AM\" (HKD) INC","LU0109392836.USD":"富兰克林科技股A","IE0004445239.USD":"JANUS HENDERSON US FORTY \"A2\" (USD) ACC","IE0004445015.USD":"JANUS HENDERSON BALANCED \"A2\" (USD) ACC","LU0011850046.USD":"贝莱德全球长线股票 A2 USD","BK4532":"文艺复兴科技持仓","BK4554":"元宇宙及AR概念","BK4515":"5G概念","LU0097036916.USD":"贝莱德美国增长A2 USD","LU0466842654.USD":"HSBC ISLAMIC GLOBAL EQUITY INDEX \"A\" (USD) ACC","LU0689472784.USD":"安联收益及增长基金Cl AM AT Acc","BK4553":"喜马拉雅资本持仓","BK4534":"瑞士信贷持仓","LU0289961442.SGD":"SUSTAINABLE GLOBAL THEMATIC PORTFOLIO \"AX\" (SGD) ACC","PLTR":"Palantir Technologies Inc.","BK4533":"AQR资本管理(全球第二大对冲基金)","LU0820561818.USD":"安联收益及增长平衡基金Cl AM DIS","BK4566":"资本集团","LU0149725797.USD":"汇丰美国股市经济规模基金","LU0354030511.USD":"ALLSPRING U.S. LARGE CAP GROWTH \"I\" (USD) ACC","IE00BKVL7J92.USD":"Legg Mason ClearBridge - US Equity Sustainability Leaders A Acc USD","LU1551013425.SGD":"Allianz Income and Growth Cl AMg2 DIS H2-SGD","LU0354030438.USD":"富国美国大盘成长基金Cl A Acc","LU1989764748.USD":"东方汇理环球颠覆性机遇A2 Acc","LU0127658192.USD":"EASTSPRING INVESTMENTS GLOBAL TECHNOLOGY \"A\" (USD) ACC","LU0256863811.USD":"ALLIANZ US EQUITY \"A\" INC","IE00BJTD4N35.SGD":"Neuberger Berman US Long Short Equity A1 Acc SGD-H","LU1989764664.SGD":"CPR Invest - Global Disruptive Opportunities A2 Acc SGD-H","BK4559":"巴菲特持仓","LU0289739343.SGD":"SUSTAINABLE GLOBAL THEMATIC PORTFOLIO \"A\" (SGD) ACC","BK4550":"红杉资本持仓","LU2458330169.SGD":"FRANKLIN SHARIAH TECHNOLOGY \"A\" (SGD) ACC","IE00B775SV38.USD":"NEUBERGER BERMAN US MULTICAP OPPORTUNITIES \"A\" (USD) ACC","LU0943347566.SGD":"安联收益及增长平衡基金AM H2-SGD","IE00B3S45H60.SGD":"Neuberger Berman US Multicap Opportunities A Acc SGD-H","LU2458330243.SGD":"FRANKLIN SHARIAH TECHNOLOGY \"A-H1\" (SGDHDG) ACC"},"source_url":"https://seekingalpha.com/article/4652276-palantir-50-per-share-is-not-unreasonable","is_english":true,"share_image_url":"https://static.laohu8.com/5a36db9d73b4222bc376d24ccc48c8a4","article_id":"2383849512","content_text":"Palantir, the enigmatic tech provider for the CIA and Department of Defense, has attracted significant investor interest since going public in 2021.The company is expensive, but it offers visionary products that streamline operations and decision-making for government and commercial clients.Palantir's financials are improving, with growing revenue, higher gross margins, and a swing from operating losses to profits. The company's growth potential and profitability make it an attractive investment.Kevin Dietsch/Getty Images NewsAlmost no other company gets as much attention as Palantir (NYSE:PLTR) does these days.The enigmatic tech provider for the CIA and Department of Defense went public in 2021, and since then there's been an unbelievable amount of investor interest in the company, on both sides of the market.Some see the company, and its CEO, Alex Karp, as visionary. Others see the tech firm as an overblown, speculative venture that dilutes its shareholders to no end and hasn't earned a substantial profit in over 20 years.In some sense, both sides are right. The company is expensive nominally at over 19x revenue, and PLTR only just recently turned a positive TTM profit - it's first since the company's founding. The diluted share count also continues to grow, as free cash flow has been strong, but real, net profits have been elusive.However, while there are some issues, the company produces a visionary, mission critical product to an entrenched (and growing) customer base.It's three main products, Gotham, Foundry, and Apollo power government and commercial clients to do more with less, all while streamlining operations and decision making across an organization.Plus, it's new 'AIP', or Artificial Intelligence Platform, stands to further bolster PLTR's suite of products. Given that PLTR's whole mission is to empower organizations to use their data better, LLM interfacing seems like it could be a serious value add for corporations as well as modern warfighters and intelligence gathering organizations.In our view, despite the aforementioned concerns, it seems as though Palantir (and it's stock) could be in the early innings of a serious run.Today, we're going to take a deeper look into PLTR, its prospects, and its valuation to determine whether or not the company is worth your hard-earned capital.Sound good? Let's jump in!FinancialsAs always, let's start with the company's financial results.In short, PLTR is growing, and beginning to turn the corner on profitability.In their recent Q3 report, PLTR reported $0.07 in EPS, along with $558 million in revenue, both of which came in above expectations:Seeking AlphaYear-over-year revenue growth came in at ~17%, which was a slight pickup from the quarter prior, and remains well above index - and industry - averages.Looking at the income statement, the company reported higher revenue as discussed, but was able to keep the revenue-related-costs the same, which translated to much higher gross margins YoY:10QWhen combined with slightly lower operating expenses at $410 million vs. $432 million a year prior, PLTR has clearly done a good job of managing costs within the business.These COGS and OpEx improvements translate to a nearly $100 million swing in YoY operating income, from red to black.When adding in the impact of higher rates, more treasuries on the balance sheet, and an improved liability profile, operating to net adjustments further accentuate how far the company has come in a few short quarters: a $122 million loss in last year's Q3, to an ~$80 million profit in this year's.If you remove the $114 million in stock-based compensation, the picture only improves further.Zooming out somewhat, the company has done a good job when it comes to net revenue retention and growth. TTM sales continue to increase like clockwork off of the back of the company's strong product suite, and AIP in particular:TradingViewHere's what management had to say about the continued growth:In Q3, we closed 80 deals of $1 million or more across 30 industries, 29 deals of $5 million or more across 16 industries, and 12 deals of $10 million or more across 11 industries.Our U.S. commercial business accelerated last quarter, growing 33% year-over-year. Excluding strategic commercial contracts, it grew 52% year-over-year and 19% sequentially, and three-fourths of our quarter-over-quarter growth is from customers that started with us in 2023. Our U.S. commercial customer count rose 12% quarter-over-quarter and is now ten-fold what it was just three years ago.Deal count for our U.S. commercial business is 2.4x what it was in Q3 of last year and U.S. commercial TCV closed at $252 million, up 55% year-over-year on a dollar-weighted duration basis. We're also seeing the acceleration of larger deals and shorter times to conversion and expansion, including a multiyear deal in excess of $40 million with one of the largest home construction companies in the U.S. to start up pilot and converted all within Q3.This growth is in part due to AIP's continued transformation of the way we partner with and deliver value for our customers, and we expect AIP's impact to continue to intensify. The rapid expansion of AIP at both our existing and new customers, and the impact it is having on their operations is nothing short of remarkable.Naturally, this growth wouldn't matter if customers were churning. However, with a NRR figure of 107%, it's clear that isn't happening.The ValuationCritics say that PLTR is expensive, and it's true. Trading at just over 19 times sales, PLTR's improving profitability and continued growth demand quite a premium in today's market:TradingViewFor reference, Apple (AAPL), perhaps the most well-known, profitable company of this century, trades at around 7.6x sales.That said, the company is trading at a relative bargain vs. where it was in the low interest rate era in 2021, and with real profits to fall back on, the present valuation seems far more palatable.From another angle, PLTR reminds us of ServiceNow (NOW) in 2018/2019. At that time, NOW was still unprofitable and around the same level in terms of TTM revenue. The company was also still diluting shareholders significantly, and the valuation, at ~16x sales, was expensive.However, as that company has grown and the multiples have remained consistent, NOW's stock has increased substantially, more than tripling over that time:TradingViewYou can see how NOW's top line multiple is still trading where it was 5 years ago or so:TradingViewWe think the same thing could happen to PLTR.Common investing maxims often suggest that one of the best times to get involved in a stock is when a company growing top line sales begins to swing from lossmaking to profitability, as PLTR is doing now.Despite the monster 200%+ rally that PLTR has seen YTD, we think there's still gas left in the tank as the company continues pushing on all fronts:TradingViewRight now, PLTR trades at 8x 2022 revenue estimates:Seeking AlphaShould the multiple remain constant through that period, then that would imply a 2027 market cap between $95-$105 billion. Extrapolating out today's price and market cap, that suggests that the stock could more than double to a target around $50.This model does factor in a consistent supply of shares over time, which PLTR has not been capable of maintaining:TradingViewThat said, as the company grows and becomes more profitable, we suspect that the company will dilute less. It may even be in the position, in a few years' time, where it looks to begin a buyback similar to the one NOW just instituted.Either way, we think there's potential for the underlying stock to soar on the back of a sustained premium multiple and strong underlying growth and profitability.RisksWhile we like where PLTR is potentially headed, there are plenty of risks that investors should be aware of when it comes to investing in PLTR stock for the long haul. Here are a few key things to keep in mind:Dependence on Government Contracts: A significant portion of PLTR's revenue comes from government contracts, particularly from defense and intelligence agencies. This reliance makes the company vulnerable to changes in government spending, policy shifts, and political climates. That said, after working its way into being a trusted defense procurement company, it seems unlikely that it would be dropped without significant warning.Competitive Market and Technological Changes: The field of data analytics and big data is highly competitive, with many players vying for market share. PLTR operates in an environment where rapid technological advancements are common. While the company has done a good job of staying ahead up to this point, there's always a concern that a competitor could disrupt PLTR's commercial offerings, which could mean a serious dent in revenue.Reputation and Privacy Concerns: PLTR's work, particularly with government agencies, has raised concerns around data privacy and ethical use of its technology. Any negative publicity or backlash could impact its business relationships and brand image, potentially leading to lost contracts or legal challenges.Complexity of the Platform: PLTR's platforms, like Gotham and Foundry, are complex and require significant training and expertise to use effectively. This could limit adoption and growth.SummaryOverall, despite the risks, we like what we see when it comes to Palantir. The company's financials have never been in better shape, and the company's product remains sticky.If management can reduce dilution and the keep the results coming (and thus, the premium multiple), then we think it's possible that a price target of $50 per share within a few years is not unreasonable.We rate PLTR stock a \"Strong buy\".Cheers!","news_type":1},"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"langContent":"EN"}],"hasMoreComments":true,"newsSizeData":{"likeSize":19,"commentSize":2,"repostSize":1,"favoriteSize":3,"likeStatus":false,"favoriteStatus":false}}