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Palantir Technologies Inc Ordinary Shares - Class A PLTR

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Morningstar’s Analysis

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Palantir’s Commercial Strength Accelerates Top-Line Growth in Q2; Raising Fair Value Estimate to $28

Mark Cash Senior Equity Analyst

Analyst Note

| Mark Cash |

We are raising our fair value estimate for narrow-moat Palantir Technologies to $28 from $25, based on higher growth expectations after its second-quarter results topped our expectations for revenue growth and adjusted earnings. Strong growth and heavy sales and marketing investments are expected to continue in the third quarter, and Palantir doubled its previously guided adjusted free cash flow for 2021 to at least $300 million. We believe the concerted efforts in ramping up the salesforce and channel partners are gaining traction, and nice customer count additions in the quarter showcase Palantir lowering the barriers to product adoption. We think Palantir is uniquely positioned to help solve complex data integration and analytics challenges and is in the early stages of scaling its solutions across industries. Shares increased by more than 10% after the strong results, and we view shares as slightly undervalued.

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Company Profile

Business Description

Palantir Technologies provides organizations with solutions to manage large disparate data sets in an attempt to gain insight and drive operational outcomes. Founded in 2003, Palantir released its Gotham software platform in 2008, which focuses on the government intelligence and defense sectors. Palantir expanded into various commercial markets with its Foundry software platform in 2016 with the intent of becoming the data operating system for companies and industries. The Denver, Colorado company had 125 customers as of its IPO and roughly splits its revenue between commercial and government customers.

1555 Blake Street, Suite 250
Denver, CO, 80202
T +1 720 358-3679
Sector Technology
Industry Software - Infrastructure
Most Recent Earnings Jun 30, 2021
Fiscal Year End Dec 31, 2021
Stock Type Distressed
Employees 2,593