We got here throughout a bearish thesis on Palantir Applied sciences Inc. on Valueinvesting subreddit by smltc. On this article, we are going to summarize the bulls’ thesis on PLTR. Palantir Applied sciences Inc.’s share was buying and selling at $158.80 as as of July 25th. PLTR’s trailing and ahead P/E had been 690.43 and 277.78, respectively in line with Yahoo Finance.
A software program engineer manipulating an enormous community of code on digital displays.
Palantir Applied sciences has emerged as one of the crucial talked‑about names within the AI growth, with its information analytics platforms Gotham and Foundry, initially designed for intelligence businesses, now broadly utilized by enterprises and governments. The corporate’s newly launched AI platform allows pure‑language querying, additional fueling investor pleasure about its potential to dominate the AI‑pushed information analytics area. Monetary efficiency has been sturdy, with Q1 2025 income rising 39% 12 months‑over‑12 months to $884 million, U.S. gross sales up 55%, and industrial income surging 71%.
Palantir stays worthwhile, incomes $462 million in 2024 and $214 million within the newest quarter, supported by $5.4 billion in money reserves and no lengthy‑time period debt. Its buyer base stays closely skewed towards authorities contracts, contributing roughly 55% of income, and the highest 20 purchasers account for a considerable share, creating focus threat. Shares have soared greater than 400% over the previous 12 months, closing round $159 on July 25, propelled by AI optimism.
Nevertheless, the valuation—buying and selling at over 120× trailing gross sales and 200× subsequent 12 months’s earnings—is traditionally excessive, implying that even modest progress disappointments might result in steep declines. A reduced money‑movement evaluation, even with bullish assumptions, suggests honest worth nearer to $20–30 per share, in keeping with different quick‑rising software program friends buying and selling at 8–20× gross sales.
Dangers embrace intensifying competitors from tech giants, reliance on giant clients, potential authorities price range tightening, and shareholder dilution from heavy inventory‑primarily based compensation. Whereas Palantir’s fundamentals stay sturdy, analysts warning that exuberant pricing leaves little margin for error, making the inventory a speculative guess regardless of its operational momentum.
Beforehand we coated a bullish thesis on Palantir Applied sciences Inc. (PLTR) by Deep Worth Returns in Might 2025, which highlighted its sturdy progress, AI management, and worthwhile scaling regardless of a premium valuation. The corporate’s inventory has appreciated about 46% since, pushed by AI optimism. smltc shares a contrarian view and emphasizes excessive valuation dangers and draw back potential.
