Palantir Technologies (PLTR) AI Stock Analysis

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Palantir Technologies

(NASDAQ:PLTR)

76Outperform

Palantir Technologies scores well due to its strong financial performance, highlighted by impressive revenue growth and cash flow generation. The positive sentiment from the earnings call supports its growth potential, particularly in AI and government sectors. However, the high P/E ratio poses a valuation concern, and technical indicators suggest caution due to potential overbought conditions.

Positive Factors

Contract Wins

A record $810 million in US Commercial TCV was booked, showing a significant increase of 183% year-over-year.

Earnings

Palantir delivered a strong beat/raise start to FY25 with upside across most metrics, albeit at a smaller cadence.

US Commercial Growth

Palantir's US Commercial business accelerated to +70% year-over-year, with sustained demand in the pipeline, reflecting its effectiveness in executing AI strategies.

Negative Factors

International Performance

International Commercial revenue was again the weak link, where it declined 6% YoY and 10%+ sequentially with PLTR noting continued weaker AI uptake in EMEA.

Post-Earnings Reaction

Palantir is down 9% after hours despite revenue and EBIT margin exceeding expectations, due to smaller beats compared to prior quarters and elevated expectations.

Valuation Concerns

The stock is seen as priced for 'beyond perfection' at 55x FY26 EV/Sales, with tougher comps likely to drive slowing growth in 2H25 and into FY26.

Palantir Technologies (PLTR) vs. S&P 500 (SPY)

Market Cap

$256.81B

Dividend YieldN/A

Average Volume (3M)108.45M

Price to Earnings (P/E)475.4

Beta (1Y)2.64

Revenue Growth33.45%

EPS Growth82.50%

CountryUS

Employees3,936

SectorTechnology

Sector Strength66

IndustrySoftware - Infrastructure

Share Statistics

EPS (TTM)0.13

Shares Outstanding2,262,682,900

10 Day Avg. Volume104,120,615

30 Day Avg. Volume108,448,499

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)0.00

Price to Cash Flow (P/CF)0.00

P/FCF Ratio0.00

Enterprise Value/Market Cap0.82

Enterprise Value/RevenueN/A

Enterprise Value/Gross Profit91.48

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$98.56

Price Target Upside-10.79% Downside

Rating ConsensusHold

Number of Analyst Covering18

Palantir Technologies Business Overview & Revenue Model

Company DescriptionPalantir Technologies Inc. is a public American software company that specializes in big data analytics. Founded in 2003 and headquartered in Denver, Colorado, Palantir operates primarily in the sectors of government, finance, healthcare, and commercial industries. The company offers a suite of software applications for integrating, visualizing, and analyzing information. Its core products include Palantir Gotham, used primarily by government agencies to counter terrorism, and Palantir Foundry, which is tailored for commercial clients to manage and interpret complex data sets.

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 Key Performance Indicators (KPIs)

Any

Total Customers

Total Customers
Counts the number of unique customers, showcasing market reach and adoption of the company’s products or services.

Chart InsightsPalantir's customer base has expanded significantly, with a notable acceleration in growth from 2023 to 2024. This aligns with their strong U.S. market performance and increased demand driven by AI and enterprise software solutions. The earnings call highlighted a 64% year-over-year growth in U.S. commercial revenue and a 56% increase in total contract value, underscoring the company's strategic positioning and successful customer acquisition. However, challenges in Europe and declining strategic contract revenue could pose risks to sustaining this momentum.

Data provided by:

Main Street Data

Palantir Technologies Financial Statement Overview

Summary

Palantir Technologies exhibits strong financial health with remarkable revenue and profit growth. The company maintains excellent margins and cash flow metrics, underscoring operational efficiency. While the balance sheet remains strong, attention to liabilities is recommended to mitigate potential risks.

Income Statement

Very Positive

Palantir Technologies has demonstrated strong revenue growth with a 41.6% increase from 2023 to TTM (Trailing-Twelve-Months). The gross profit margin is impressive at 80.0% for TTM, indicating efficient cost management. Net profit margin improved significantly to 18.3% in TTM, a positive shift from previous losses. EBIT and EBITDA margins have also strengthened, reflecting enhanced operational efficiency.

Balance Sheet

Positive

The balance sheet shows strong equity with an equity ratio of 80.5% in TTM, signifying financial stability. The debt-to-equity ratio remains low at 0.05, reducing financial risk. Return on equity has improved to 10.5% in TTM, showcasing better return on shareholder investment. However, the high total liabilities compared to assets could pose a potential risk.

Cash Flow

Very Positive

The cash flow statement reveals robust free cash flow growth of 15.5% from 2023 to 2024, supporting continued investment and operations. The operating cash flow to net income ratio is 2.34 in TTM, indicating strong cash generation relative to profits. The free cash flow to net income ratio of 2.31 suggests healthy cash flow relative to earnings.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
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
341.99M	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

Technical Analysis Sentiment

Positive

Last Price110.48

Price Trends

50DMA

92.77

Positive

100DMA

89.15

Positive

200DMA

65.72

Positive

Market Momentum

MACD

7.38

Negative

RSI

56.29

Neutral

STOCH

51.04

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PLTR, the sentiment is Positive. The current price of 110.48 is above the 20-day moving average (MA) of 104.28, above the 50-day MA of 92.77, and above the 200-day MA of 65.72, indicating a bullish trend. The MACD of 7.38 indicates Negative momentum. The RSI at 56.29 is Neutral, neither overbought nor oversold. The STOCH value of 51.04 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive 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 (60)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ORCL	81 Outperform	$414.19B	35.08	108.79%	1.14%	6.23%	12.37%
PLTR	76 Outperform	$256.81B	475.37	12.41%	―	33.45%	82.50%
CRWD	76 Outperform	$109.86B	721.64	-0.69%	―	29.39%	-119.62%
PANW	74 Outperform	$124.93B	106.60	23.38%	―	13.86%	-46.44%
FTNT	72 Outperform	$82.39B	47.41	205.91%	―	13.83%	58.13%
MDB	63 Neutral	$13.98B	―	-6.70%	―	19.22%	28.46%
Sector *	60 Neutral	$10.83B	10.47	-6.71%	2.99%	7.73%	-12.97%

* Technology Sector Average

Performance Comparison

PLTR

Palantir Technologies

119.15

98.01

463.62%

FTNT

Fortinet

97.74

39.63

68.20%

ORCL

Oracle

150.30

34.95

30.30%

PANW

Palo Alto Networks

188.53

40.69

27.52%

MDB

MongoDB

179.26

-175.43

-49.46%

CRWD

CrowdStrike Holdings

428.63

110.69

34.81%

Palantir Technologies Earnings Call Summary

Earnings Call Date:May 05, 2025

(Q1-2025)

% Change Since: -10.74%|

Next Earnings Date:Aug 11, 2025

Earnings Call Sentiment Positive

The earnings call highlighted strong revenue growth across various segments, particularly in the US market, and a significant demand for AI products. However, there were challenges in the international commercial market, particularly in Europe. The company's financial and operational metrics are robust, and it has a positive outlook for the future.

Q1-2025 Updates

Positive Updates

Strong Revenue Growth

Revenue grew 39% year-over-year, exceeding guidance by nearly 350 basis points. US revenue grew 55% year-over-year and 13% sequentially.

US Commercial Business Milestone

Surpassed $1 billion annual run rate in US commercial business for the first time, with 71% year-over-year growth.

Significant Demand for AIP

US commercial TCV bookings were $810 million, representing 239% year-over-year growth. Closed twice as many $1 million+ deals compared to the previous year.

Impressive Government Segment Performance

US government revenue grew 45% year-over-year. International government revenue grew 45% year-over-year.

Robust Financial Metrics

Adjusted operating margin of 44%, representing an 800 basis point increase. Adjusted free cash flow of $370 million with a margin of 42%.

Positive Market Outlook

Raising full-year revenue guidance midpoint to $3.896 billion, representing a 36% year-over-year growth rate.

Negative Updates

Challenges in International Commercial Revenue

International commercial revenue declined 5% year-over-year and 11% sequentially, driven by continued headwinds in Europe.

Company Guidance

During Palantir's First Quarter 2025 Earnings Call, significant metrics showcased the company's robust growth and strategic positioning. The call highlighted a remarkable 39% year-over-year revenue growth, with U.S. revenue surging 55% and constituting 71% of the overall business. The U.S. commercial sector posted a 71% increase in revenue, surpassing a $1 billion annual run rate. The company also recorded a 45% growth in its U.S. government business. Palantir's rule of 40 score improved to 83% from the previous quarter's 81%, reflecting combined revenue growth and adjusted operating margin. Additionally, Palantir closed $810 million in U.S. commercial TCV, marking a 239% year-over-year growth, and the customer count increased by 39% year-over-year to 769. The company raised its full-year 2025 revenue guidance midpoint to $3.896 billion, projecting a 36% growth, and its adjusted free cash flow guidance to between $1.6 billion and $1.8 billion. These metrics emphasize Palantir's strong momentum and strategic focus on AI-driven solutions across both commercial and government sectors.

Palantir Technologies Corporate Events

Business Operations and StrategyFinancial Disclosures

Palantir Technologies Reports Strong Q1 2025 Revenue Growth

Positive

May 5, 2025

On May 5, 2025, Palantir Technologies reported a significant revenue growth of 39% year-over-year for Q1 2025, with U.S. revenue increasing by 55%. The company raised its full-year revenue guidance to a 36% growth, with U.S. commercial revenue expected to grow by 68%, surpassing consensus expectations. This growth is attributed to a shift in software adoption, particularly in the U.S., and highlights Palantir’s strong market positioning and operational success, as evidenced by its Rule of 40 score of 83% and a substantial increase in total contract value.

Spark’s Take on PLTR Stock

According to Spark, TipRanks’ AI Analyst, PLTR is a Outperform.

Palantir Technologies scores well due to its strong financial performance, highlighted by impressive revenue growth and cash flow generation. The technical analysis suggests positive momentum but with caution due to potential overbought conditions. The high P/E ratio poses a valuation concern, although strong earnings call sentiment underscores the company’s growth potential, particularly in the AI and government sectors.

To see Spark’s full report on PLTR stock, click here.

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.

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.