Just some food for thought...
Big Tech companies have been investing capital into AI like there's no tomorrow and $Palantir(PLTR.US$ is poised to ride that train into the sunset. The major question on everyone's mind is whether or not Palantir Technologies can clear the major hurdles it faces on its way to sustained growth.
Shares have soared an impressive 58.8%, leaving $S&P 500 Index(.SPX.US$ in the dust. It gets better, though. $Palantir(PLTR.US$ has already gained 38.9% so far, in 2024 alone.
Since the impressive climb in February, it would appear that Palantir Technologies has been consolidating and moving sideways ever since. So what's in store for the future?
Palantir Technologies boasts a market cap of around $51.5 billion and an enterprise value of $50.6 billion, and the company is priced at a premium. The forward price/earnings ratio is a cool 149.81, with a price/sales multiple of 19.09. And if that's not enough to make your head spin, the price-to-earnings-growth (PEG) ratio clocks in at a staggering 5.49.
Investors are clearly betting big on Palantir Technologies' future growth potential, but these high multiples also mean the company needs to deliver consistent growth to justify the hefty price tag.
Palantir Technologies Q1 earnings report showed that they raked in $634 million in revenue, surpassing the estimated $625 million and marking a 21% year-over-year increase. Earnings per share (EPS) came in right on target at $0.08, and their net income reached $105.5 million. All of that is just icing on the cake, but the guidance miss was huge.
Poor investments are one thing, but poor managerial choices can and will lead to massive losses. However, having landed one massive $480 million deal with the Army after another $178 million deal is more than impressive. As such, Palantir Technologies' debt to income ratio is miles apart.
The future of Palantir Technologies is looking very bright indeed.
GL TRADERS!
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