Palantir Stock Surges, Outperforming Tech Peers
Palantir Technologies (PLTR) has continued its impressive momentum in 2024, with its stock rising 41% year-to-date, far outpacing the Nasdaq Composite's 3% gain. The AI software company's shares hit a record high on Thursday, fueled by strong financial results and raised expectations.
Financial Performance Drives Stock Surge
Palantir's financial performance in the fourth quarter of 2023 was exceptional. US revenue surged 52% year-over-year, driven by a 64% and 45% growth in sales to commercial and government clients, respectively. Adjusted operating profit margins soared to 45% from 34% a year ago. Adjusted operating profits nearly doubled in 2023 to $1.13 billion.
Optimism and Skepticism Shape Analyst Views
Analysts have been revising their EPS expectations for Palantir upward since its earnings report. However, some remain skeptical due to the stock's premium valuation relative to peers. Palantir's forward PE ratio of 181 times is significantly higher than NVIDIA's 29 times.
Analyst Insights
* Morgan Stanley: Analyst Sanjit Singh believes the premium valuation is justified given Palantir's unique growth trajectory.
* DA Davidson: Analyst Gil Luria remains positive on Palantir but acknowledges its valuation as a concern.
* RBC Capital Markets: Analyst Rishi Jaluria expresses skepticism about the sustainability of recent results, maintaining a bearish price target of $40.
Despite the varying opinions, Palantir's strong financials and growth potential continue to attract investors, driving the stock's recent surge.