Why Palantir is a Game-Changer: 2 Reasons to Invest in the Future of Big Data

•  Michael Green

•  Mar 03 2023
 

stocks in the spott

Palantir is a Silicon Valley-based software company that specializes in big data analytics and surveillance. Founded in 2003 by Peter Thiel, a prominent tech entrepreneur and investor, and a group of former PayPal employees, Palantir has gained a reputation for being one of the most secretive and controversial companies in the tech industry.

At its core, Palantir's software is designed to help government agencies and private companies analyze large amounts of data and make better-informed decisions. Its clients include law enforcement agencies, intelligence agencies, and military organizations around the world, as well as companies in the financial and healthcare sectors. Some of Palantir's most high-profile clients have included the CIA, NSA, and ICE, which has led to criticism and protests from human rights groups and privacy advocates.

Palantir's software allows its clients to collect and analyze vast amounts of personal data on individuals, including social media activity, financial transactions, and location data.

Palantir has been successful in attracting investors and growing its business. The company went public in 2020 and is now valued at over $16.8 billion. It has also been awarded numerous government contracts, including a $1.5 billion contract with the US Army in 2019.

So why this is the time to buy Palantir?

Reason #1: PLTR Is Too Cheap for Its Own Good

The stock market crash of 2022 left PLTR trading at its most attractive valuation level ever. And that gives it plenty of room to rally in 2023 as the stock’s trend changes direction.

In the fourth quarter of 2022, Palantir grew revenue 17.5% to $508.6 million, above analyst estimates, and delivered adjusted (non-GAAP) earnings per share of $0.04, beating expectations by $0.01.

However, not only did Palantir deliver adjusted profits, it actually delivered $30.9 million in GAAP net profits, or $0.01 per share. That was certainly surprising, given that most investors and even Palantir itself hadn't forecast GAAP profitability until several years out. Furthermore, management said it expects the company to be profitable on a GAAP basis in 2023 as well.

On the conference call with analysts, CEO Alex Karp said: "We promised you GAAP profitability in 2025, which you thought would be in 2027 perhaps. We are now, in the last quarter, GAAP profitable, and we plan to be GAAP profitable in this year."

Reason #2: growth and margins

The second reason why Palantir stock will keep soaring in 2023 is because the company’s profit margins are set to meaningfully expand this year.

Palantir is an early stage growth company with a best-in-class, high-demand product in a rapidly growing industry. As such, no one has ever really questioned the company’s long-term revenue growth prospects. Pretty much everyone knows this company will grow revenues by 20% to 30% over the next several years.

Conclusion

Palantir is a powerful player in the world of big data analytics and surveillance. Its software has the potential to improve decision-making and enhance national security.

Palantir will continues to grow and expand its reach, it will likely remain a leader in in big data analytics.

Disclaimer: The article does not constitute investment advice or marketing that takes into account the data and the special needs of each person.

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