Palantir Technologies Inc. (PLTR): A Bull Case Theory

We came across a bullish thesis on Palantir Technologies Inc. (PLTR) on Rijnberk InvestInsights’ Substack by Daan Rijnberk. In this article, we will summarize the bulls’ thesis on PLTR. PLTR Technologies, Inc. share was trading at $36.90 as of Sept 24th. PLTR’s trailing and forward P/E were 217.06 and 87.72 according to Yahoo Finance.

Palantir (PLTR) is often seen as a data analytics company, but it’s a software business that helps organizations pull together huge amounts of data to find problems, risks, or opportunities. The company serves two main groups: governments and businesses. Its Gotham Platform is used by Palantir to handle security threats like terrorism by analyzing massive amounts of data and the Foundry platform is used to streamline operations, like reducing inefficiencies or spotting potential fraud. The biggest potential for Palantir now is its Artificial Intelligence Platform which is a tool unlike general AI that helps companies build custom AI models using their data, making it much more useful for their specific needs. AIP has gained traction, growing by 40% in the U.S. and 27% internationally. Palantir’s revenue has been increasing at an annual rate of nearly 24.7% over the last three years and it also holds $3.87 billion in cash and very little debt making it financially stable, but its high-growth status comes with risks, especially given its reliance on big government contracts.

Palantir is growing internationally, with contracts like the one with the NHS in the UK. Most of its revenue is still from the U.S., so there’s a big chance for global growth. The company is good at getting current customers to spend more, like Lowe’s using more of its AI tools. Overall, Palantir is strong in AI and data software, has solid finances, and a clear growth path, making it a good investment.

Palantir Technologies Inc. is also not on our list of the 31 Most Popular Stocks Among Hedge Funds. As per our database, 44 hedge fund portfolios held PLTR at the end of the second quarter which was 45 in the previous quarter. While we acknowledge the risk and potential of PLTR as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than PLTR but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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Disclosure: None. This article was originally published at Insider Monkey.