Palantir: Market Participants Have Already Fully Priced The Potential Of AI

Summary:

• In 3Q24, Palantir’s revenue grew 30.11% y/y, with US commercial revenues up 54% y/y and government revenues up 40% y/y. Operating margin and net margins expanded to 15.56% and 19.83%.
• PLTR is well positioned to benefit from the accelerating adoption of artificial intelligence, providing a strong tailwind for the company’s growth.
• Apart from topline headwinds, PLTR is making excellent progress in its operations. Rule of 40 expanded to almost 70 points, while operating margin and cashflow margins continue to improve.
• Unfortunately, valuation analysis suggests that market participants have already fully priced in the potential of PLTR. Investors should avoid buying at the current price; those who already have positions should consider reducing.

Introduction

Based on my analysis, although Palantir (NASDAQ:PLTR) is: (1) well-positioned to benefit from the accelerating adoption of artificial intelligence and (2) expanding its margins and improving its operational efficiencies, market participants have already priced in the full potential of PLTR. My

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