PLTR - A balanced look at Palantir with some price target upsides

Summary of Palantir Palantir is expected to grow by 30% in 2021, but its growth rate is decelerating. PLTR'S management expects the fiscal year 2024 revenue to reach $4 billion, indicating strong revenue expectations. Long-term performance is already shaping up to be healthy, courtesy of the existing backlog of contracts worth $2.8 billion. The Achievability of long-term targets is also gaining visibility. Near-term and long-term growth visibility aligns with Palantir's growth expectations. PLTR expects to become more attractive in the commercial market thanks to channel partners such as IBM and Foundry modularization efforts. Company background Palantir is a software company that makes software solutions for corporate clients that wish to integrate their operations, decisions, and data into a single platform to achieve higher efficiency. Its goal is to provide software that offers quick and convenient accessibility to the right data. The company has three main projects namely Palatin Foundry, Palatin Gotham, and Palatin Metropolis. Federal agencies and local governments are among the company’s initial clients. It also serves clients in the healthcare and financial industries, as well as private clients. Analyst rating and price target PLTR seems to be in favor with Wall Street. For example, Keith Weiss, a popular Morgan Stanley analyst, recently upgraded his price target to $19 from the previous $17. Christopher Merwin from Goldman Sachs has bigger expectations for the stock, considering that he upgraded the price target from $13 to $34. Brad Zelnick from Credit Suisse expects the stock to underperform, although he upped his target to $20 from the previous $17. Not all analysts are optimistic about the stock price performance. Kamil Mielczarek from William Blair downgraded the stock and expects it to underperform. Eight of the top Wall Street analysts have issued their consensus estimate with their current 12-month price target at $23.14. They also expect a potential downside of 4.60%. The lowest price target was $10.00, while the highest price target was $40. Two of the eight analysts have a buy rating for Palantir’s stock, while two others have a hold rating. The remaining four have a sell rating. Institutional ownership PTLR has a healthy portfolio of institutional investors, and some of them happen to be top players at Wall Street. They include Soros Fund Management Llc, founded by billionaire George Soros. This management firm owns 18.46 million Palantir shares. Another hot investment management firm called Blackrock Inc owns 33.355 million PTLR shares. Billionaire Peter Thiel’s hedge fund is the biggest institutional has the largest shareholding in the company at 268.45 million shares. Financial summary As far as financial performance is concerned, Palantir has been experiencing decelerating revenue growth. Its revenue growth figure dropped from 52% in 3Q2020 to 40% in 4Q2020. Analysts predict that revenue growth in 1Q2021 will recover to 45%, although it is expected to drop to around 30% for the subsequent quarterly periods in 2021. Recent news There has been a lot of chatter about PTLR’s collaboration with IBM, which will combine numerous offerings such as operational technology, data processing, artificial intelligence, and hybrid cloud. The merging of these solutions will create a new product known as Palantir for IBM Cloud Pak, which will be offered to business clients. The partnership and the resulting product are expected to provide convenience to various industries, including aerospace, manufacturing, healthcare, finance, and retail. The convenience will be delivered through the adoption of AI to deliver more convenience. One great use case example for Palantir for IBM Cloud Pak is the retail segment, where it can provide easier supply and demand trends analysis. Palantir previously announced that it partnered with Amazon to optimize the ERP Suite to make it available to millions of clients that rely on AWS. The company secured another key partnership with SOMPO Holdings towards the end of 2020. However, the partnership amounted to a 1-year contract through which Palantir received $22.5 million. The partnership will work on SOMPO’s Real Data Platform, aiming to improve supply chains in multiple industries and boost healthcare in Japan. PTLR announced more recently that it plans to hold its “Double Click” event on April 14. The company plans to showcase its latest offerings at the event while also demonstrating how customers can take advantage of those offerings to introduce more efficiencies into their operations. The company hopes that the demo event will capture more potential clients' imagination and contribute to attracting more clients while remaining attractive to existing clientele. More customers will translate to healthier revenues in the future as the new offerings provide more growth opportunities. The partnerships with companies such as Amazon and IBM mean that the company has been doing business with industry juggernauts. It means that Palantir is playing in the big leagues where there are more opportunities and exposure, which may also translate to more revenue opportunities in the future.

back
default-avatar-0

AndrewWynn

Mar 17, 2021

13.53%

Change % Since Posting

25.21

Price When Posted

3.41

Change Since Posting

PLTR

Palantir Technologies Inc - Class A

28.62

-0.01
-0.03%
Current Price

PLTR - A balanced look at Palantir with some price target upsides

bullish

Summary of Palantir

  • Palantir is expected to grow by 30% in 2021, but its growth rate is decelerating.
  • PLTR'S management expects the fiscal year 2024 revenue to reach $4 billion, indicating strong revenue expectations.
  • Long-term performance is already shaping up to be healthy, courtesy of the existing backlog of contracts worth $2.8 billion. The Achievability of long-term targets is also gaining visibility.
  • Near-term and long-term growth visibility aligns with Palantir's growth expectations.
  • PLTR expects to become more attractive in the commercial market thanks to channel partners such as IBM and Foundry modularization efforts.

Company background

Palantir is a software company that makes software solutions for corporate clients that wish to integrate their operations, decisions, and data into a single platform to achieve higher efficiency. Its goal is to provide software that offers quick and convenient accessibility to the right data.

The company has three main projects namely Palatin Foundry, Palatin Gotham, and Palatin Metropolis. Federal agencies and local governments are among the company’s initial clients. It also serves clients in the healthcare and financial industries, as well as private clients.

Analyst rating and price target

PLTR seems to be in favor with Wall Street. For example, Keith Weiss, a popular Morgan Stanley analyst, recently upgraded his price target to $19 from the previous $17. Christopher Merwin from Goldman Sachs has bigger expectations for the stock, considering that he upgraded the price target from $13 to $34.

Brad Zelnick from Credit Suisse expects the stock to underperform, although he upped his target to $20 from the previous $17. Not all analysts are optimistic about the stock price performance. Kamil Mielczarek from William Blair downgraded the stock and expects it to underperform.

Eight of the top Wall Street analysts have issued their consensus estimate with their current 12-month price target at $23.14. They also expect a potential downside of 4.60%. The lowest price target was $10.00, while the highest price target was $40. Two of the eight analysts have a buy rating for Palantir’s stock, while two others have a hold rating. The remaining four have a sell rating.

Institutional ownership

PTLR has a healthy portfolio of institutional investors, and some of them happen to be top players at Wall Street. They include Soros Fund Management Llc, founded by billionaire George Soros. This management firm owns 18.46 million Palantir shares. Another hot investment management firm called Blackrock Inc owns 33.355 million PTLR shares. Billionaire Peter Thiel’s hedge fund is the biggest institutional has the largest shareholding in the company at 268.45 million shares.

Financial summary

As far as financial performance is concerned, Palantir has been experiencing decelerating revenue growth. Its revenue growth figure dropped from 52% in 3Q2020 to 40% in 4Q2020. Analysts predict that revenue growth in 1Q2021 will recover to 45%, although it is expected to drop to around 30% for the subsequent quarterly periods in 2021.

Recent news

There has been a lot of chatter about PTLR’s collaboration with IBM, which will combine numerous offerings such as operational technology, data processing, artificial intelligence, and hybrid cloud. The merging of these solutions will create a new product known as Palantir for IBM Cloud Pak, which will be offered to business clients.

The partnership and the resulting product are expected to provide convenience to various industries, including aerospace, manufacturing, healthcare, finance, and retail. The convenience will be delivered through the adoption of AI to deliver more convenience. One great use case example for Palantir for IBM Cloud Pak is the retail segment, where it can provide easier supply and demand trends analysis.

Palantir previously announced that it partnered with Amazon to optimize the ERP Suite to make it available to millions of clients that rely on AWS. The company secured another key partnership with SOMPO Holdings towards the end of 2020. However, the partnership amounted to a 1-year contract through which Palantir received $22.5 million. The partnership will work on SOMPO’s Real Data Platform, aiming to improve supply chains in multiple industries and boost healthcare in Japan.

PTLR announced more recently that it plans to hold its “Double Click” event on April 14. The company plans to showcase its latest offerings at the event while also demonstrating how customers can take advantage of those offerings to introduce more efficiencies into their operations. The company hopes that the demo event will capture more potential clients' imagination and contribute to attracting more clients while remaining attractive to existing clientele.

More customers will translate to healthier revenues in the future as the new offerings provide more growth opportunities. The partnerships with companies such as Amazon and IBM mean that the company has been doing business with industry juggernauts. It means that Palantir is playing in the big leagues where there are more opportunities and exposure, which may also translate to more revenue opportunities in the future.

Comments

Write your comment....

Sign in to comment

read-time
4 min

28.99

Target Price

6/ 10

Confidence

6-12 Months

Timeframe
catalyst icon
Earnings Release
catalyst icon
News
catalyst icon
SEC Filing
catalyst icon
Sentiment
catalyst icon
Other Catalyst

PLTR Channel

Start new chat
next