"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 53.63%."
"While the stock's forward P/E ratio of 244.02 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 Q1 results can serve as a foundation for further rewards for shareholders. In the first quarter, Palantir saw year-over-year revenue growth of 39%. U.S. commercial business surpassed a $1 billion run rate, good for 71% year-over-year growth. Meanwhile, its U.S. government revenue grew 45% year-over-year."
Palantir's stock has surged, rising 153.62% year-to-date and 1,972.82% since its October 2022 IPO. Q3 results beat expectations with EPS of $0.21 and revenue of $1.18 billion, and guidance tied growth to adoption of the AI software platform. Government sales grew 52% year-over-year. Major contracts include a £1.5 billion U.K. defense deal and a consolidated U.S. Army 10-year arrangement valued at $10 billion. Institutional ownership has declined to 53.63% amid large position reductions. Q1 showed 39% revenue growth, U.S. commercial exceeded a $1 billion run rate (71% growth), and U.S. government revenue rose 45%. The forward P/E of 244.02 implies valuation risk, with a payback period of decades if earnings remain unchanged, while company and Wall Street analysts assume continued growth will justify the valuation.
Read at 24/7 Wall St.
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