"When the company reported Q3 earnings on Nov. 3, it beat on the top and bottom lines with EPS of 21 cents versus 17 cents expected, and revenue of $1.18 billion versus $1.09 billion expected. Palantir issued strong guidance, attributing growth to adoption of its AI software platform. Meanwhile, it announced that government sales - which have been essential to Palantir's rise - grew 52% from the same quarter a year ago."
"In September, it was reported that the company agreed to a £1.5 billion defense deal with the U.K. That comes not he back of an announcement in early August that the U.S. Army is consolidating 75 contracts into a single 10-year arrangement with Palantir valued at $10 billion. However, the so-called smart money have been selling the stock in flurries lately, leaving Palantir's institutional ownership at just 54.69%. JPMorgan, for example, recently reduced its position in PLTR by more than 32%, while T. Rowe Price reduced its position by nearly 24%."
"While the stock's forward P/E ratio of 204.01 can be concerning, Palantir's federal contracts and aerospace ties are expected to continue fueling growth. While earnings are rear-facing, the emerging trends seen in the company's Q3 results can serve as a foundation for further rewards for shareholders. However, PLTR's market multiple implies it could take an investor nearly half a century to recover their initial investment, assuming earnings remained constant. But the assumption from the company - and from Wall Street analysts - is that earnings will continue to grow."
Palantir's shares rose 1.04% over the past five trading sessions after a prior 0.20% decline, with the stock up nearly 154% year-to-date and about 1,975.65% since its October 2022 IPO. Q3 results showed EPS of $0.21 versus $0.17 expected and revenue of $1.18 billion versus $1.09 billion expected, and management linked growth to adoption of its AI software platform. Government sales grew 52% year-over-year, and major defense deals include a £1.5 billion U.K. contract and a potential $10 billion U.S. Army consolidation. Institutional ownership has fallen to 54.69% amid notable fund reductions, and the forward P/E sits around 204, implying high expectations for future earnings growth.
Read at 24/7 Wall St.
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