Palantir Technologies: Beware The Bottom Falling Out (Rating Downgrade)

(12min)

Summary

  • Palantir Technologies' stock has surged 88.5% since August, outperforming the S&P 500, but shares are now deemed excessively expensive.
  • Despite impressive revenue and profit growth, including a 34.8% revenue increase in Q3 2024, the stock's valuation is unsustainable.
  • The company's strong financials, including no debt and $4.56 billion in cash, are overshadowed by its high trading multiples.
  • Given the lofty valuations, even with continued rapid growth, I downgrade Palantir Technologies to a 'sell' due to likely underperformance.
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Palantir Technologies

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One of the best performing stocks in recent months has been none other than software giant Palantir Technologies (NYSE:PLTR). Since I last reaffirmed the company as a ‘hold’ candidate back in August of this year, shares are up

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This article was written by

Daniel Jones profile picture
32.62K Followers

Daniel is an avid and active professional investor.

He runs Crude Value Insights, a value-oriented newsletter aimed at analyzing the cash flows and assessing the value of companies in the oil and gas space. His primary focus is on finding businesses that are trading at a significant discount to their intrinsic value by employing a combination of Benjamin Graham's investment philosophy and a contrarian approach to the market and the securities therein. Learn more.

Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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