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Palantir Technologies Inc Ordinary Shares - Class A PLTR

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Morningstar’s Analysis

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Palantir Accelerates Commercial Business in Q3, and We Raise Our FVE to $31; Shares Undervalued

Mark Cash Senior Equity Analyst

Analyst Note

| Mark Cash |

We are raising our fair value estimate for narrow-moat Palantir Technologies to $31 per share from $28 after third-quarter results provide us with increased conviction in the company's strong growth prospects, even while amassing scale. Year-over-year sales growth of 36% matched our expectations, while adjusted earnings per share of $0.04 came in slightly higher than we anticipated. Shares fell as much as 10% after Palantir reported results, which we believe is due to government revenue declining 6% sequentially, although against a tough comparison, and the fourth-quarter outlook potentially being conservative. Taking a longer-term view and being upbeat about Palantir’s tailored use case software modules making its software more easily consumable across industries and organization sizes, we believe the negative reaction creates an attractive entry point for investment.

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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 company had 125 customers as of its initial public offering 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 Sep 30, 2021
Fiscal Year End Dec 31, 2021
Stock Type Speculative Growth
Employees 2,733