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Palantir Valuation Tracker [July]
Monitoring Palantir's valuation to not overpay.
Is it still cheap now?
PLTR 0.00%↑ is now at $10. This means that on ‘22FY it is valued:
These multiples include the effect of SBC in terms of the increased number of shares.
According to my framework, these multiples are still interesting for a company with:
Recurring Revenues (Is Palantir Recession Proof?);
+30% growth for many years.
For details on my method, you can read Palantir Buy Signals - A Dive Inside my Playbook.
PLTR Historical Multiple
Palantir’s EV/Sales NTM is still in its lowest range and nearly -40% from DPO.
EV/Sales NTM is lower than EV/Sales ‘22 because it considers ‘22q2-‘23q2 numbers which are expected to be higher than ‘22 FY numbers.
Compared with our last Peer Valuation (Palantir Deserves More - Peers Valuation), Palantir now trades deservedly at a similar multiple as ServiceNow ( NOW 0.00%↑ ), which I consider the closest financial comparable (Seeking the Alpha: PLTR vs NOW).
As a reminder:
Efficiency Score = Revenues Growth + FCF Margin.
Cloud companies still trade on avg. at a multi-year low at 6x EV/Sales.
Palantir could rebound if there will be renewed interest in SaaS companies.
What I am doing
At this price, I am in “do nothing” since my avg. price is $8 per share (~35% of portfolio).
If the price drops below $7 again, after a misinterpretation of the financial results similar to Q1 (Palantir Q1: better than it seems), I would act.
We thrive in good times and we thrive in bad times. - Alex Karp, Palantir CEO
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View expresses are my own. Do not represent Financial Advice.
I own (many) PLTR 0.00%↑ stocks.