PLTR - Palantir: Do Not Rush In
2024-06-26 13:35:39 ET
Summary
- Palantir has reported very good 40% YoY US commercial revenue growth in the recent quarter, but other key metrics do not support a strong bullish sentiment in the stock.
- The YoY US government revenue growth was only 12% and this segment contributes over 40% of the total revenue base.
- Palantir’s adjusted operating margin has also expanded to 36% from 24% a year ago, and it is unlikely that there can be significant improvement from an already high margin level.
- Palantir’s AI growth potential is strong, but investors should wait for a pull back to add this stock, which makes the stock a Sell at the current price.
Palantir ( PLTR ) stock has been range-bound between $20 and $25 for the past few months. Some of the strong positives for the company are more than matched by the negatives. The most positive factor working in favor of Palantir is the AI boom, and Wall Street is ready to give a higher valuation multiple for companies working in this sector. There is also a FOMO factor working within the top management of several companies, and they are willing to pay top dollars to try new AI software. This helped Palantir in reporting a 40% YoY growth in US commercial revenue growth in the recent quarter. However, the US commercial revenue was only $150 million out of the total revenue base of $634 million, or less than 25%....
Palantir: Do Not Rush In