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Palantir Technologies (PLTR)
NASDAQ:PLTR
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Palantir Technologies
(NASDAQ:PLTR)76Outperform
Positive Factors
AI Opportunities
Palantir is leveraged to the AI and GenAI themes sweeping through the tech sector, which are enormous market opportunities likely to create several multi-billion dollar revenue companies.
Revenue Growth
U.S. commercial and U.S. government remain key drivers, growing 64% and 45% YOY.
Negative Factors
Valuation Concerns
The major pushback on the bullish view will be valuation, with nearly 44x EV/2027E Revenue making it hard to say this is the right spot to step up on PLTR.
Palantir Technologies (PLTR) vs. S&P 500 (SPY)
Market Cap
$199.17B
Dividend YieldN/A
Average Volume (3M)103.27M
Price to Earnings (P/E)449.1
Beta (1Y)2.83
Revenue Growth28.79%
EPS Growth112.38%
CountryUS
Employees3,735
SectorTechnology
Sector Strength48
IndustrySoftware
Share Statistics
EPS (TTM)0.19
Shares Outstanding2,248,951,000
10 Day Avg. Volume135,482,554
30 Day Avg. Volume103,274,060
Financial Highlights & Ratios
PEG Ratio4.00
Price to Book (P/B)N/A
Price to Sales (P/S)69.51
Price to Cash Flow (P/CF)108.20
P/FCF Ratio108.90
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$93.13Price Target Upside10.34% Upside
Rating ConsensusHold
Number of Analyst Covering18
Palantir Technologies Business Overview & Revenue Model
Company DescriptionFounded in 2003 and headquartered in Colorado, Palantir Technologies Inc. is a software company that specializes in big data analytics. The company serves public institutions, private enterprises, and non-profit sector.
How the Company Makes MoneyPalantir Technologies generates revenue primarily through the sale of software subscriptions and services. The company employs a subscription-based model for its software platforms, allowing clients to access its suite of data integration, management, and analytical tools. Key revenue streams include government contracts, with significant partnerships involving agencies such as the Department of Defense and the U.S. Intelligence Community. Additionally, Palantir increasingly serves commercial enterprises, offering customized data solutions to large corporations across various industries. The company's revenue is bolstered by its ability to create tailored solutions that embed deeply into client operations, fostering long-term contracts and high client retention rates. Partnerships with large organizations and a focus on expanding into new commercial sectors also contribute significantly to Palantir's financial performance.
Palantir Technologies Financial Statement Overview
Summary
Palantir Technologies exhibits strong financial health with significant revenue growth, improved profitability, and a solid capital structure. The company has a robust gross profit margin and a notable increase in net profit margin, indicating improved operational efficiency. The balance sheet is strong with low leverage, and cash flow generation is efficient, supporting positive free cash flow.Income Statement
Palantir Technologies has demonstrated significant revenue growth over the past years, with a notable increase from $742.6 million in 2019 to $2.87 billion in 2024. The gross profit margin is robust at approximately 80.27% for 2024, indicating effective cost management relative to revenue. The net profit margin improved considerably, reaching 16.13% in 2024, showcasing a turnaround from previous years of losses, highlighting improved profitability and operational efficiency.85
Very Positive
Balance Sheet
The company's balance sheet reflects a strong equity position with stockholders' equity of $5 billion in 2024, significantly higher than its total debt of $239 million, resulting in a low debt-to-equity ratio. The equity ratio stands at 78.91%, indicating a solid capital structure. However, the return on equity is relatively moderate at 9.24%, suggesting potential areas for improving shareholder returns.78
Positive
Cash Flow
Palantir's cash flow statement reveals a strong operating cash flow of $1.15 billion in 2024, which supports its positive free cash flow of $1.14 billion. The free cash flow to net income ratio is high, indicating efficient cash generation relative to net earnings. The company has shown consistent improvement in free cash flow growth, which is a positive indicator of financial health and operational efficiency.82
Very Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 2.87B | 2.23B | 1.91B | 1.54B | 1.09B | Gross Profit |
| 2.30B | 1.79B | 1.50B | 1.20B | 740.13M | EBIT |
| 310.40M | 119.97M | -161.20M | -411.05M | -1.17B | EBITDA |
| 310.40M | 153.32M | -334.45M | -469.96M | -1.15B | Net Income Common Stockholders |
| 462.19M | 209.82M | -373.70M | -520.38M | -1.17B |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 5.23B | 3.67B | 2.63B | 2.52B | 2.01B | Total Assets |
| 6.34B | 4.52B | 3.46B | 3.25B | 2.69B | Total Debt |
| 239.22M | 229.39M | 249.40M | 260.07M | 456.86M | Net Debt |
| -1.86B | -601.65M | -2.35B | -2.03B | -1.55B | Total Liabilities |
| 1.25B | 961.46M | 818.80M | 956.42M | 1.17B | Stockholders Equity |
| 5.00B | 3.48B | 2.57B | 2.29B | 1.52B |
| Cash Flow | Free Cash Flow | |||
| 1.14B | 697.07M | 183.71M | 321.22M | -308.84M | Operating Cash Flow |
| 1.15B | 712.18M | 223.74M | 333.85M | -296.61M | Investing Cash Flow |
| -340.65M | -2.71B | -45.43M | -397.91M | -14.92M | Financing Cash Flow |
| 463.36M | 218.84M | 86.00M | 306.75M | 1.04B |
Palantir Technologies Technical Analysis
Neutral
84.40
Price Trends
86.63
Negative
71.64
Positive
50.15
Positive
Market Momentum
-0.82
Positive
40.82
Neutral
14.32
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PLTR, the sentiment is Neutral. The current price of 84.4 is below the 20-day moving average (MA) of 103.03, below the 50-day MA of 86.63, and above the 200-day MA of 50.15, indicating a neutral trend. The MACD of -0.82 indicates Positive momentum. The RSI at 40.82 is Neutral, neither overbought nor oversold. The STOCH value of 14.32 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for PLTR.
Palantir Technologies Risk Analysis
Palantir Technologies disclosed 84 risk factors in its most recent earnings report. Palantir Technologies reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Palantir Technologies Peers Comparison
Overall Rating
UnderperformOutperform
Sector (59)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $30.11B | ― | -2.54% | ― | 30.77% | 79.05% | |
76 Outperform | $199.17B | 449.07 | 9.24% | ― | 28.79% | 112.38% | |
69 Neutral | $58.46B | ― | -41.70% | ― | 29.21% | -51.47% | |
68 Neutral | $15.51B | ― | 78.42% | ― | 15.33% | ― | |
66 Neutral | $74.48B | ― | -28.38% | ― | 23.19% | 11.01% | |
66 Neutral | $39.95B | 220.39 | 6.77% | ― | 26.12% | 274.50% | |
59 Neutral | $22.39B | 11.53 | -18.05% | 2.31% | 5.00% | -25.89% |
* Technology Sector Average
Performance Comparison
PLTR
Palantir Technologies
84.40
60.59
254.47%
TEAM
Atlassian
273.62
77.29
39.37%
OKTA
Okta
108.31
1.32
1.23%
ZS
Zscaler
193.82
-12.54
-6.08%
DDOG
Datadog
115.46
-8.07
-6.53%
SNOW
Snowflake
173.60
5.85
3.49%
Palantir Technologies Earnings Call Summary
Earnings Call Date: Feb 3, 2025 | % Change Since: 0.79% | Next Earnings Date: May 12, 2025
Earnings Call Sentiment Positive
The earnings call reflected a strong positive sentiment with significant revenue growth, especially in the U.S. market, driven by the AI revolution and strong government contracts. Despite some challenges in Europe and a decline in strategic contract revenue, the overall performance was exceptional, marked by record operating margins and high net dollar retention.Highlights
Exceptional Revenue Growth
Revenue grew 14% sequentially and 36% year-over-year in Q4, with full-year growth at 29% year-over-year. U.S. business led with a 52% year-over-year increase in Q4.
AI Revolution and Customer Expansion
Closed $1.8 billion of TCV in Q4, a 56% increase year-over-year, with 32 deals worth $10 million or more. U.S. commercial revenue grew 64% year-over-year.
Strong Government and International Performance
U.S. government revenue grew 45% year-over-year. Notable deals include extensions with the U.S. Army and U.S. Special Operations Command.
Record Operating Margins and Cash Flow
Adjusted operating margin expanded to 45%, the strongest in the company's history. Adjusted free cash flow for Q4 was $517 million, representing a 63% margin.
High Net Dollar Retention
Net dollar retention was 120%, driven by expansions at existing customers and new customers acquired.
Lowlights
Anemic Growth in Europe
European operations saw a low growth rate of 4%, contrasting sharply with U.S. performance.
Declining Revenue from Strategic Contracts
Revenue from strategic commercial contracts expected to decline significantly in Q1 2025.
Company Guidance
In the Palantir Fourth Quarter 2024 Earnings Call, the company reported impressive financial metrics and growth figures. Palantir achieved a 36% year-over-year revenue increase in Q4 and a 29% rise for the full year, with U.S. business driving much of this success. The U.S. commercial revenue grew by 64% year-over-year and 20% sequentially in Q4. Additionally, the company closed $1.8 billion in total contract value (TCV) during the quarter, marking a 56% increase year-over-year. Palantir's Rule of 40 score surged to 81, and they reported a record $517 million in adjusted free cash flow for Q4, representing a 63% margin. For fiscal year 2025, they are guiding to a midpoint revenue of $3.749 billion, reflecting a growth rate of 31%. Despite the challenges, Palantir's unique positioning in the AI and enterprise software landscapes, particularly through its ontology framework, continues to drive significant demand and expansion opportunities.Palantir Technologies Corporate Events
Executive/Board Changes
Palantir Reappoints Jeffrey Buckley as Chief Accounting Officer
Neutral
Feb 28, 2025
On February 27, 2025, Palantir Technologies announced the reappointment of Jeffrey Buckley as Chief Accounting Officer, effective March 24, 2025. Buckley, who previously served in the same role at Palantir until February 2023, returns to replace David Glazer, who temporarily held the position following Heather Planishek’s resignation. Buckley’s compensation includes a $400,000 annual salary and a restricted stock unit award valued at $3,500,000, reflecting Palantir’s commitment to strengthening its financial leadership.
Business Operations and StrategyFinancial Disclosures
Palantir Technologies Reports Strong Q4 Revenue Growth
Positive
Feb 3, 2025
On February 3, 2025, Palantir Technologies reported a significant revenue growth of 36% year-over-year for Q4 2024, with U.S. revenue increasing by 52%. The company highlighted its strong position in the AI sector and announced its FY 2025 revenue guidance of 31% growth, surpassing consensus estimates. Key achievements included closing 129 deals worth at least $1 million and achieving a record $803 million in U.S. commercial total contract value. The company also reported a GAAP net income of $79 million and adjusted free cash flow of $517 million for the quarter, indicating robust financial health and operational efficiency.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.