PLTR - Palantir: Insider Sales And High Valuations Vs Strong Operational Performance
2024-06-04 09:30:00 ET
Summary
- I expected Palantir to underperform the S&P500 and indeed it has done so by 18.58% overall since my last update on the stock. I think this will continue:
- Revenues are growing well along with the backlog; customer counts and concentration are increasing broadening out; higher quality recurring revenues are increasing and margins have room to grow further.
- But despite this impressive operational performance, I am deterred by record high levels of insider sales, including large >25% of overall stake exits by 3 insiders.
- Valuations are also on the higher side vs historical levels and a higher-for-longer rates environment poses additional risk in this regard.
- My read of the technicals suggests continued underperformance vs the S&P500 going ahead.