Palantir stocks just witnessed a 19 percent surge after the company’s fourth-quarter earnings were released, boasting an impressive performance much enhanced by the AI boom. Analysts had placed Palantir Technologies (PLTR) stock on the growth track even before the report was released but other investors have been wary of the international growth potential of the organization and whether the company can live up to its predicted potential. The Palantir earnings report reported a revenue of $608 million and surpassed the estimates of the FactSet consensus which had been reported at $603 million.
Palantir Technologies (PLTR) is a software company that was founded in 2003 by Peter Thiel, Nathan Gettings, Joe Lonsdale, Garry Tan, Stephen Cohen, and Alexander Karp. “We make products for human-driven analysis of real-world data,” the company states and to achieve this, the company focuses on building platforms and layering applications to create a system for effective big data analysis.
Palantir Stock Price Forecasts
In the recently released Palantir earnings report for the fourth quarter, Palantir reported revenue of $608 million, marking a 20 percent increase compared to the previous year and surpassing the FactSet consensus estimate of $603 million. Consistency is key and this is where the company wavered as its first-quarter revenue projections fell slightly short of the consensus, forecasts placing it between $612 million and $616 million whereas the analysts had expectations of $617 million. Overall, the company has quite positive expectations for revenue numbers consolidated for 2024, anticipating revenue between $2.652 billion and $2.668 billion, compared to the external estimates of $2.644 billion. Palantir expects adjusted free cash flow to range between $800 million to $1 billion for 2024 and also has an optimistic growth rate prediction of at least 40 percent.
Q4 2023 Highlights of the Palantir Earnings Report
Palantir reported a net income of $93 million, which represents the profit the company made after accounting for all expenses and taxes. This net income margin was 15%, indicating that $0.15 out of every dollar of revenue generated was profit. It also reported a GAAP EPS of $0.04; the adjusted EPS was $0.08. Adjusted EPS provides a clearer picture of the company’s ongoing profitability, as it removes unusual or non-operational items. Breaking down the profits behind the Palantir stock price surge, the US commercial operations revenue increased by 70 percent compared to the previous year, reaching $131 million while overall commercial revenue grew by 32 percent year-over-year to $284 million. Palantir’s government also witnessed an 11 percent year-over-year growth to $234 million.
The adjusted income from operations for US commercial operations was $209 million, with a margin of 34 percent. This represents the fifth consecutive quarter of expanding adjusted operating margins. Palantir reported strong cash metrics, with cash from operations totaling $301 million, representing a 50 percent margin. Adjusted free cash flow was $305 million, also representing a 50 percent margin. Additionally, the company holds $3.7 billion in cash, cash equivalents, and short-term US treasury securities. Overall, the company witnessed significant growth in its revenue, customer count, contract value, and cash metrics, making the Palantir stock price forecast perceive a continued upward trajectory for the company. With four straight quarters of profitability, Palantir’s stock might qualify for inclusion in the S&P 500 according to CNBC.
Palantir Stock Price
The Palantir stock price currently stands at $16.72. The stock closed at $16.09 in the previous trading session and opened at $16.21 at the beginning of the current session. The PLTR stocks have a day range of $16.48 to $17.87 and the 52-week range has been quite significant, from $7.19 to $21.85. With a 263.1 PE ratio and $0.08 earnings per share, the analyst consensus currently lies on holding on to the Palantir stock while the market stabilizes around it. The stock appears to be doing quite alright and there should be no major shifts in its value anytime soon. Tip Ranks also indicates a bullish blogger sentiment indicates optimism and confidence in the stock’s potential for price appreciation so if there are changes to the Palantir stock, it should trend upwards.
“The demand for large language models from commercial institutions in the United States continues to be unrelenting. Every part of our organization is focused on the rollout of our Artificial Intelligence Platform (AIP), which has gone from a prototype to a product in months. And our momentum with AIP is now significantly contributing to new revenue and new customers.” —Alexander C. Karp, Chief Executive Officer & Co-Founder of Palantir Technologies Inc.
The company’s continued work with the government has been providing the company with quite a bit of stability with nearly 60 percent of its revenue from this source, but its commercial segment and AI offerings have been pushing the business forward quite efficiently as well. Some appear wary that some of the company’s governmental contracts are up for renewal and any hindrance to the procedure could cause the stocks to waver but there are no signs that there should be any issue in the renewal process. Others are also unsure if the company will be able to prolong its current AI success, dissuading a “sell” rating right off the bat. The company appears largely well-placed to continue growing towards its predicted numbers, especially as the fourth platform, the AIP service, has been expanding exponentially. All things considered, it does seem like a good time to hold Palantir stock today.
