Palanter (Nasdaq: Pltr)) Actions are known for its noble evaluation, but to understand how extreme it has become, consider this: dilution from last year alone has added more market value than the total value of many software companies.
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This dilution is not a minor. In the past year, the Big Data company issued 148 million additional shares, bringing its number of shares diluted to 2.56 billion. Indeed, this added about 28 billion dollars of market value, despite the fact that Palantir should generate only $ 4.15 billion in revenues this year. In terms differently, the value created solely based on purchase options and ISU granted to executives and the best talents is approximately seven times the income goal, even exceeding the price / sale ratio of a heavy goods vehicle like Salesforce.
It is precisely this dynamic, including the best investors Stone Fox Capital (SFC) warns.
“At more than 100x sales, the course of Palantir’s action reflects excessive optimism, which makes it a dangerous bet for investors despite solid recent results,” explains SFC, which is classified among the 3% most expert in stocks on Tipranks.
This warning occurs while Palantant continues to publish impressive growth. In the second quarter, revenues increased by 48% in annual sliding, exceeding $ 1 billion for the first time, US commercial sales bankrupt 93%. However, this segment only brought in $ 306 million during the quarter. SFC argues that this type of growth seems spectacular because the company is still in the “AI start -up phase” – and as Palantir goes into the range of $ 5 billion to $ 10 billion, the growth rate will inevitably be slow.
For more prospects, SFC stresses that Palantir shares have exploded 1,870% in the past five years, even if income has increased by 244% over the same period.
The main point to remember for investors is that holding this stock has a significant risk. Any setback could erase more than 75% of the value of the action, and doubts would remain on the question of whether Palantir would be an attractive purchase of a market capitalization exceeding $ 100 billion, recalling the loss of loss of the loss of Microsoft (Microsoft investors who bought at $ 60 in 2000 during the loss of half of the end of 2013, 75% during the financial jugs circuit.
To be clear, the investor does not exclude more. In fact, SFC concedes that Palantir could still climb to $ 200 per share, potentially pushing its market capitalization nearly 1 dollars. However, diving here is equivalent to playing with fire.
“Palantant is likely to continue to report accelerated growth for a period, and the market tends to remain optimistic in these scenarios, but the risk of decline only grows with the gains here,” summed up the investor, PLTR shares a strong sale. (To watch the history of Stone Fox Capital, click here)
Wall Street overall is less severe but barely optimistic. On the basis of 13 sockets, 5 purchases and 2 sells, the analyst’s consensus calls for a take (i.e. neutral), with an average target of $ 154.56, which implies a drop of ~ 13% compared to next year. (See Stock PLTR forecasts))
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Warning: The opinions expressed in this article are only those of the star investor. Content is intended to be used for information only. It is very important to do your own analysis before investing.
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