Great take. I’ve been saying it for awhile now. Palantir is completely misunderstood in the market. Palantir’s primary competition is companies building these solutions in-house. Not other software vendors. Not because competitors don’t exist, on paper they do. Databricks, Snowflake, DataWalk. But asking a large enterprise customer to rip out the central nervous system of their data infrastructure to move to a competitor is asking them to undergo major surgery while running a business. This is the moat that valuation models miss.
The dilution math is the key part everyone misses. If you're growing revenue 60% and EBIT 90% while diluting shares only 4.6%, that's literally the opposite of a problem. The whole SBC debate becomes noise when the per-share value is compounding faster than the share count is expanding.
Palantir has diluted shareholders by 400% since 2018. Can you imagine what the stock price would be, if that hadn’t happened? You’re arguing about Palantir’s fundamentals, but you’re missing the point of Burry’s position. He bought a long put option for 2027 with a strike price of $50 for about $1. He is essentially betting that, over the next two years, Palantir will stop growing at its current pace or perhaps experience a few downward revisions, causing it to no longer trade at a 400 P/E ratio (which is higher than any MAG7 stock, by the way). If that happens, his option price will increase significantly, even if Palantir’s stock doesn’t drop to $50. I wouldn't "bury" the odds of that happening. What is funny, you and Burry can both make money at the same time, meaning Palantir can be a great company in the long term, while Burry can make a nice profit in the meantime.
How do Palantir shareholders sleep at night knowing that this investment is supporting the mass roundup of immigrants treating them like cockroaches with absolutely no right to challenge these actions and no restitution for wrongful detainment? I made a fair bit of money on Palantir, but sold on confirmation that its tools were being used for unlawful purposes. This is not what I was led to believe by Karp’s preaching about saving democracy.
Great take. I’ve been saying it for awhile now. Palantir is completely misunderstood in the market. Palantir’s primary competition is companies building these solutions in-house. Not other software vendors. Not because competitors don’t exist, on paper they do. Databricks, Snowflake, DataWalk. But asking a large enterprise customer to rip out the central nervous system of their data infrastructure to move to a competitor is asking them to undergo major surgery while running a business. This is the moat that valuation models miss.
Exactly this! Thanks for reading
So rounding up illegals and deporting them is unlawful??? Interesting.
I wonder what the solution would be for people raising the concern.
Great read, also i love the title 😂👍🏼
Thanks for reading!
Would love to do a collaboration post with you! would you be open to that?
The dilution math is the key part everyone misses. If you're growing revenue 60% and EBIT 90% while diluting shares only 4.6%, that's literally the opposite of a problem. The whole SBC debate becomes noise when the per-share value is compounding faster than the share count is expanding.
Amen!
Since 2008, roughly 70-80% of Michael Burry’s public calls and contrarian bets haven’t panned out (or were painfully early).
Arny,
I calculated that the current revenue per share is about 1.6 dollars. Earnings about 30 cents.
Not sure what growth rate is implied for a share price at 180+.
Palantir has diluted shareholders by 400% since 2018. Can you imagine what the stock price would be, if that hadn’t happened? You’re arguing about Palantir’s fundamentals, but you’re missing the point of Burry’s position. He bought a long put option for 2027 with a strike price of $50 for about $1. He is essentially betting that, over the next two years, Palantir will stop growing at its current pace or perhaps experience a few downward revisions, causing it to no longer trade at a 400 P/E ratio (which is higher than any MAG7 stock, by the way). If that happens, his option price will increase significantly, even if Palantir’s stock doesn’t drop to $50. I wouldn't "bury" the odds of that happening. What is funny, you and Burry can both make money at the same time, meaning Palantir can be a great company in the long term, while Burry can make a nice profit in the meantime.
Would not bet against him…
How do Palantir shareholders sleep at night knowing that this investment is supporting the mass roundup of immigrants treating them like cockroaches with absolutely no right to challenge these actions and no restitution for wrongful detainment? I made a fair bit of money on Palantir, but sold on confirmation that its tools were being used for unlawful purposes. This is not what I was led to believe by Karp’s preaching about saving democracy.
What kind of confirmation do you have that is being used for unlawful purposes vs helping executing the law?