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Chart Talks: Palantir entered a bullish continuous triangle amid earnings release
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AkLi joined discussion · May 11, 2023 09:53

PLTR Deep Dive and Cathie Wood (For Followers)

I like waking up and doing these, but for some reason this one really stands out to me.
Let's start out with a brief history of the stock to current day.
(Part 1: History)
Palantir IPO
I. PLTR was originally set to IPO in 2020. Through its time as a private company, PLTR has never once turned a profit, has huge corporate and performance losses, and was fundamentally not a sound company. As I conduct research, there was certainly a lot of doubt and speculation of risk around the company.
PLTR Deep Dive and Cathie Wood (For Followers)
Palantir opened at $10 on Wednesday in the company's debut on the New York Stock Exchange, and closed the trading session at $9.50 with a market cap of 16.5B. Although the company had been founded in 2003, the company, as mentioned, was never profitable. Upon going public, there was controvercy around who the company choses to do buisness with, who owned a majority of the shares, and human rights violations when working with ICE.
TLDR; PLTR did not have a good start, but the show must go on!
Palentir's Investors get curious
II. 2020 was a year that I am sure all of us did not enjoy and suffered from one way or another...unless you were an investor of PLTR and holding call options. Palentir just reported its first earnings since IPO and wouldn't you believe... they beat expectations!
PLTR Deep Dive and Cathie Wood (For Followers)
You can read all of the SEC filings here Palantir IR
However, despite these numbers, palentir's overall performance was lacking and as a result closed down 8.65% on the day. In the following days, Palentir saw some insider selling, most notably from Stephen Cohen, on 11/19/2020 for 18.500 shares a huge position at the time. But insider news speculated that this wasn't all too bad, given their optimistic forward guidance + wall street bets liked the stock, thus onwards it went.
Squeeze
III. So far, earnings went "fine", Reddit was all over the stock, and no one thought it would get to this point during a global pandemic, but the printer was on. As mentioned, Stephen Cohen sold Palentir, but the day before that Palentir announced their entery in the Mission Command space with the US Army. Although insider trading kept the stock down, it was already being swallowed up by investors with the hopes of seeing great returns. And for their patients, they were rewarded.
PLTR Deep Dive and Cathie Wood (For Followers)
In the weeks to follow, Palentir announced multiple contracts with the FDA, Greek Government, the US Army reaffirmed their partnership with an over 100M contract, and expanded their 31.5M contract with NHS with a two year contract. A company once thought to be broke, was now scoring contracts left and right with good earnings throught the following days. As GameStop began it's short squeeze, profits from Palentir went into the squeeze of a life time, causing volume issues through the following months + other contraversies I am not going to get into this post.
Palentir's great descent
PLTR Deep Dive and Cathie Wood (For Followers)
IV. Palantir now travels down a decending channel with a few times looking like it would break out higher or lower. Despite news coming out about partnerships with South Korea, the announcement of Philippe Mathieu as president of Palantir EMEA, their new Apollo products, Homeland Security renewing their partnership, and collaboration with Lockheed Martin by Apollo, earnings were not sound and not what investors hoped to hear. Lower guidance, performance and outlook + spending.
(Part 2: Current)
Palantir 2023
I. Palantir has been on a slight uptrend that I think looks something like this
PLTR Deep Dive and Cathie Wood (For Followers)
Since the beginning of 2023, Palantir has introduced Quality Management systems for Life Science, announced a partnership with Cloudflare for cloud cost optimization, awarded and recognized by the Department of State and Australian Transaction Reports and Analysis Centre (AUSTRAC), secured a continued partnership with Microsoft Cloud, supported Ukranian Prosecuter General's investigation into war crimes, and reported their second consequitive quarter of positive GAAP net income. On the other hand, there was some insider selling.
PLTR Deep Dive and Cathie Wood (For Followers)
This data is not all the sellings or buying that happened, there could be more. This is just a nice list of known reporting.
However, most recently Cathie Wood took a 40M stake into Palantir. So lets try to figure out why, and why investors seem to like the stock.
Thoughts
II. War. Nobody wants war, unless you hold Lockheed Martin, have oil shorts or maybe hold Palantir. With their extensive military contracts being consistantly renewed by multiple governments around the world, i can understand why Palantir may be a solid hold for the future if there is a new world war. Of course that would not be good news in the slightest, but in terms of the market and Palantir it is clear to me the potential hedge value of this stock.
III. Current Economy. Right now, I think Palantir has potential to go lower, simply because of the concern around the current state of the United States and global economy. However, and this is my opinion, I really do not think congress will let the US default. That would look bad for anyone against it, and it would look bad for those who support it. At the end of the day, its a war between politicians. Will congress let millions of workers (of both sides) go unemployed to hurt Joe Biden, Yellen and the Federal Reserve? I really don't think so, but let's not get political, this is about palantir and nothing else. My point is, there's room for upside in the market, unless the US actually does default.
(Tinfoil: Biden might be giving so much military aid to Ukraine despite our economy because the US makes money of weapons exports, as well as a way to criple the Ukraine economy with "loans", sounds familar? Look at Greece for example (Greek bailout crisis in 300 words - BBC News) in order to try and generate, what one could put lightly "passive income" but thats just a thought with no backing to it)
III. Jerome Powell. Jerome has stated for a long time that he does not anticipate a slowing of rates and multiple Federal Reserve members have expressed their opinions on "higher for longer". Should we at all see a change in attitude by Jerome Powell hinting towards cutting rates (which might actually not be a good thing right now) or most anticipated pausing rates, the market is probably going to rally. How much and for how long is anyones guess. Futures have been pricing in a pause, but right now that is still uncertain given recent news and data.
III. AI. As a lot of us know, if you mention AI, the stock will probably go up on earnings. That's been the new wave since January this year. This is Palantir's home page on their website:
PLTR Deep Dive and Cathie Wood (For Followers)
Palantir has NUMEROUS contracts with AI developers, and cloud providers, as discussed, and develops AI, cloud and machine learning technologies for governments and other projects around the world.
With new projects on the way, Palantir continues their strive into AI techologies, and it is a great time to let investors know how they are doing.
PLTR Deep Dive and Cathie Wood (For Followers)
PLTR Deep Dive and Cathie Wood (For Followers)
Here is more information on projects: Palantir IR
IV. News. In the past, Palantir was incredibly popular and already has a shortsqueeze story of its own. We are overdue for another shortsqueeze of a notable size, and the last major short squeezes occured during a global pandemic. What better way to add money to your pockets in a time of high inflation + low savings than revisiting an old friend in hopes for a round two amidst worries of an economic collapse. Again, this is my opinion, but if enough investors pile into Palantir again, there would be an increase of buying volume. The numbers are not there yet for an actual good squeeze, but despite that if Palantir shares are bought up, the price will go up.
PLTR Deep Dive and Cathie Wood (For Followers)
Cathie News
In 2022 alone Cathie sold over 100M in Palantir Shares.
In 2023 Cathie added 43M in Palantir Shares.
Palantirs Q1 revenue is up 18% Y/Y to 525 Million which beat the estimate of 505 Million and sees a full year revenue in the range of 2.185 Billion to 2.235 Billion, which analysists think they will achieve 2.2 Billion.
CEO Alex Karp remarked that they anticipate complete profitability throughout each quarter to the end of the year as they achieved a revenue (525 Million) which went beyond their expectations.
It is speculated that in 2022, Cathie Sold palantir because of her influence of the price at the time and since selling it stabalized down to the $10 range. Now Cathie is buying again, so we will see what happens to the price.
Conclusion
I. This took me a while to make and do research for. I know I skipped some information from 2021-2022 but given the chart, it is clear that along the way the company lost interest from investors, had some rough earnings, and the price showed us that it's right where it started, IPO.
II. I think Palantir is a good buy and hold for the long term. Whether or not we actually see a world war, see a default, or anything else is not known. Some have a better idea than others, and Cathie Wood may be one of those. I have to agree with Cathie with this one. I am not sure about her other positions, but to me personally, despite her investment, I still appreciate this stock and think it has fundimental and hedge potential. I could be entirley wrong. We will see downsides and upsides, but long term I think I will hold a position here.
III. Should you invest in Palantir. That is entirley up to you. In this post, nothing should be seen as financial advice or be taken as a "you should buy" or "this stock will go up", because you definetly may lose money along the way. Trade at your own risk, understand what you are getting into and make a decision based on your own personal goals, finances, and whatever else you base your trades on. None of what I say should influence you, thats not my intent.
To be clear, my intentions are looking at the finances, history, and current trends to try and assess why Cathie made such a large purchase. I could be entirley wrong, so do your own research. There could be other reasons why, and she might even come out and say why she purchased it, but for now these are my thoughts and ideas into Palantir. How you choose to act, and percieve this information including future profits and losses is entirley up to you.
I hope you find this information informative and consistant. I enjoyed making this post and I hope it finds you well. Happy trading!
Usually these sorts of posts are for my followers and I don't place any tags but we'll change it up for this one.
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AkLi
Moo Contributor
Alkaline Analyst All Deep Dives: https://medium.com/@alkalinedeepdives
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