"Palantir builds enterprise AI software, with Gotham for the intelligence community, Foundry for commercial customers, and AIP turning U.S. commercial into the fastest-growing piece of the business. A year ago shares traded at $119.15. Today they sit at $137.80, a 15.65% one-year gain while the S&P 500 doubled with a 30.54% return. Q1 2026 revenue grew 85% year-over-year, FY 2026 guidance calls for another 71%, and the share price has gone nowhere since November."
"The bull case is operational. U.S. commercial revenue grew 133% YoY in Q1, and U.S. revenue as a whole grew 104% year-over-year. U.S. government revenue grew 84% year-over-year. Palantir's "Rule of 40" score has hit 145%, and the company's CEO said it "shattered" the metric that only a handful of other AI companies matched."
"Earnings are catching the multiple. Reported EPS climbed from $0.13 in Q1 2025 to $0.33 in Q1 2026, and free cash flow guidance at $4.2-4.4 billion. Forward P/E sits at 93 against trailing ~150. If 2026 revenue lands inside the $7.182 billion to $7.198 billion band, today's price stops looking absurd."
"What 150 Times Earnings Has to Justify Even after a 22.48% YTD drawdown, Palantir trades at sensible-esque prices with some precedent during bull markets. The market has already credited the company for hitting the high end of 2026 guidance and repeating in 2027. Anything softer is a derating. Stock-based compensation ran $684 million in FY 2025 against $1.625 billion in GAAP net income."
Palantir trades around $137.80 after moving sideways while broader markets rallied. The company sells enterprise AI software through Gotham for intelligence customers, Foundry for commercial customers, and AIP for U.S. commercial growth. Revenue growth is strong, with Q1 2026 revenue up 85% year over year and U.S. commercial revenue up 133% year over year. U.S. government revenue rose 84% year over year. The company reports a “Rule of 40” score of 145% and rising EPS from $0.13 in Q1 2025 to $0.33 in Q1 2026. FY 2026 guidance calls for 71% revenue growth and free cash flow of $4.2–$4.4 billion, with valuation tied to meeting guidance ranges.
#enterprise-ai-software #revenue-growth #valuation-and-earnings #free-cash-flow #us-commercial-and-government-revenue
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