It’s Coming.
Artificial Intelligence (AI) “wonder” stock $Palantir Technologies Inc.(PLTR)$ which has rocketed 5x in value over the last 12 months, is set to report its fiscal Q4 2024 earnings on Mon, 03 Feb 2025 before the opening bell.
Market is filled with news on whether PLTR will be able to live up to its reputation as the #1 AI-software company that it has grown to become.
Before delving into analysts’ expectations for PLTR, lets recap PLTR’s Q3 earnings.
Q3 Earnings.
Below was PLTR’s last quarter earnings reporting versus LSEG consensus estimates:
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Earnings per share: $0.10 (adjusted) vs $0.09 expected. (see above)
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Revenue: $726 million vs $701 million expected. (see above) It was a +30% YoY growth.
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Net income : came in at $143.5 million, or +3% YoY gain.
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Free cash flow (FCF) : was $435 million, nearly +300% YoY gain vs PLTR’s reported net income of $149 million.
What Happened After Q3 ?
PLTR had rallied on the back of its Q3 earnings (on 04 Nov 2024), that were released one day before US election in early November 2024.
Following Trump’s election win & euphoria, PLTR continued to surge, becoming one of the stocks considered to be part of the "Trump trade".
This is because investors bet on increased defense spending under Trump, which is a key part of PLTR's business.
Hargreaves Lansdown (HL.L), Snr equity analyst, Matt Britzman said:
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PLTR has become a standout in the AI revolution.
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Capturing attention with its innovative data-driven products.
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With a CEO who knows how to tell a compelling story.
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While growth potential is exciting, the question remains - whether PLTR can deliver earnings fast enough to justify its steep valuation, around 150x next year’s expected earnings.
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Setting high stakes for Monday’s Q4 earnings results, where nothing shy of perfect execution will be tolerated.
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There will be focus on PLTR’s AI platform on how it will drive companies’ adoption and converts pilot programs into full-scale contracts.
On 26 Nov 2024, PLTR’s migration from S&P 500 index to Nasdaq was completed, aligning its business to the composite index and aiding its stock price higher.
On the week of 27 Jan 2025, PLTR shares were among those tech names that fell, in the sector's broader sell-off on concerns about AI spending in the US, given its development in the space. (see above)
This came about as a result of China’s DeepSeek’s R1 AI-model, “birth” at a fraction ($5 miilion to be exact) of indecent amount of monies expended by its western counterparts.
Good news - PLTR quickly recovered and is backed, trading near all-time highs, with shares up +375% over the past year alone.
Q4 Outlook / Forecast.
To date, PLTR has beat earnings 4 quarters in a row.
Investors are expecting its amazing growth to persists. (see below)
Q4 expectations.
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Earning per shares: $0.11 (expected).
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Revenue: Expected to be between $767 - $771 million. Analysts surveyed by LSEG is looking for $741.4 million.
FY 2024 expectations.
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For FY 2024, PLTR bumped up revenue range to be between $2.805 - $2.809 billion vs $2.742 - $2.750 billion (last estimated in August 2024).
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The new range implied a +26% growth rate for FY 2024 vs LSEG’s consensus was $2.76 billion.
Summary : It was a very “positive” outlook for PLTR, announced during Q3 2024 earnings reporting. It is crunch time, now.
Will PLTR live up to its promised forecast come Mon, 03 Feb 2025 ?
Based on current situation, PLTR has 2 paths to “beat” earnings come Monday:
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PLTR could deliver greater revenue than it has promised.
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Alternatively, PLTR could report better earnings than it’s supposed to.
Even a slight earnings beat could boost the stock.
While the stock seems expensive, investors have been eager to buy it regardless.
Parting Facts.
PLTR is trading for :
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75x trailing sales.
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More than 180x trailing free cash flow (FCF).
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More than 400x trailing earnings.
In short, it looks “Overvalued” - technically speaking.
However recent history suggests investors are looking for reasons to buy Palantir despite its valuation, not because of it. Agree ?
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Do you think PLTR will hand in yet another set of stellar earnings data ?
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Do you think PLTR could rise to $100 per share as predicted by Wall Street analysts ?
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Pls "Re-post" so that more get to know. Tks! Rating is important (to me).
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