Palantir: A Big P/E But Still Undervalued

Summary:

• I previously underestimated Palantir’s scalability and government contract potential. Now, I believe it can dominate the ERP market and achieve significant growth.
• Palantir’s AIP is scalable and accessible, with flexible pricing and boot camps to increase market awareness and adoption among small and medium-sized businesses.
• Government contracts offer substantial revenue potential, with defense spending projected to reach $1 trillion by 2031, potentially adding $10 billion in revenues.
• Despite a high forward P/E, Palantir’s earnings growth could justify a valuation of $170, making it a buy with significant upside potential.

Thesis Summary

When Palantir Technologies Inc. (NASDAQ:PLTR) was trading at $38, I called for it to rally to $100. The stock has almost doubled since then.

In my last article, however, I also outlined potential problems with the company, including limitations to

Analyst’s Disclosure: I/we have a beneficial long position in the shares of PLTR either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha’s Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

This is a high-risk/high-reward opportunity, which is exactly what I look for in my YOLO portfolio.

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