PLTR

Executive Summary

Generational software compounder, hostage to a generational multiple and relentless insider selling

Palantir (PLTR) is putting up numbers almost no enterprise-software company has matched: Q1'26 revenue accelerated to +85% YoY to $1.63B, US revenue grew +104% (US commercial +133%), net dollar retention hit 150%, and the Rule of 40 reached an astonishing 145% on a 57% adjusted FCF margin. Management raised FY2026 revenue guidance to $7.65B (~+71%) and guided to positive GAAP net income every quarter. The problem is the price: at $112.93 the stock still trades near ~50x EV/revenue and ~71-78x forward earnings, the richest multiple in software — and it has already fallen ~46% from its $207.52 high, sitting just above its $106.37 52-week low amid an AI/SaaS de-rating. Insiders are selling heavily (Thiel ~$280M in March, Cohen/Sankar/Karp all sellers; ~9 sells per buy) with no open-market buying. Sell-side is net bullish (avg PT ~$182, ~+62%) but deeply split, with targets ranging from $70 to $255. We rate HOLD: the business quality is exceptional, but the valuation offers little margin of safety and we prefer to accumulate into multiple-compression weakness rather than chase.

FUNDAMENTAL METRICS

Best-in-class growth and profitability — at a price priced for perfection — Q1'26 revenue accelerated to +85% with a 145% Rule of 40 and 57% FCF margin — yet the stock trades near 50x EV/revenue, is down ~40% YTD, and sits a hair above its 52-week low.

Q1'26 Revenue

$1.633B

+85% YoY — fastest since IPO

FY2025 Revenue

$4.475B

+56% YoY

Q1'26 Adj. Op. Margin

60%

Rule of 40 = 145%

Q1'26 Adj. FCF Margin

57%

$925M adj. FCF in quarter

Net Dollar Retention

150%

+1,100 bps QoQ

Cash & US Treasuries

~$8.0B

No debt; GAAP profitable

US Commercial Rev (Q1'26)

+133% YoY

AIP-driven inflection

Forward EV/Revenue

~50x

~71-78x forward P/E

Quarterly Revenue — Trailing 4 Quarters

$1.004B

Q2 2025

$1.181B

Q3 2025

$1.407B

Q4 2025

$1.633B

Q1 2026

GROWTH & CATALYSTS

AIP land-and-expand is compounding — the debate is the multiple, not the business

+85%

Q1'26 Revenue Growth

US revenue +104%

$11.8B

Remaining Deal Value

+98% YoY

$4.2-4.4B

FY2026 Adj. FCF Guide

~57% FCF margin

Feb 2, 2026

FY2025 Results

Revenue $4.475B (+56%), 50% adjusted operating margin, GAAP EPS $0.69. US commercial +137% in Q4. Joined the S&P 100 cohort of profitable, fast-growing software names.

Mar 2026

$10B US Army Enterprise Agreement

Up to 10-year, $10B ceiling Army deal plus $446M Navy ShipOS and >$900M in federal contracts (Space Force, IRS, ICE, Treasury) — deepening the accredited government moat.

May 4, 2026

Q1'26 Blowout + Guidance Raise

Revenue +85% to $1.633B, Rule of 40 = 145%, NDR 150%. FY2026 guide raised to $7.65B (+71%) and US commercial to >$3.22B (>+120%) — yet the stock still fell on valuation.

Jun 26, 2026

Fresh 52-Week Low $106.37

Caught in a broad high-multiple software de-rating ('SaaSpocalypse'); six straight down sessions, ~40% YTD drawdown despite record fundamentals.

Aug 2026E

Q2'26 Print

Company guided Q2 revenue to ~$1.80B. Key test of whether ~80%+ growth and AIP momentum can re-rate the multiple — or whether any deceleration accelerates compression.

Earnings & Signals

Forward Estimates, Surprises & Insider Activity

Forward Earnings Estimates

FY+1 EPS Consensus$1.47 (FY2026E adj., ~+96% YoY)

FY+2 EPS Consensus$2.08 (FY2027E adj., ~+41% YoY)

PEG Ratio~1.4 (forward P/E ~75x on ~50%+ forward EPS growth)

Forward P/E~71-78x on FY2026E EPS of ~$1.47 (~50x EV/revenue; ~52x P/S)

EPS Revisions (90d)↑19 ↓0 (Uniformly positive — 19 analysts raised FY EPS estimates and 0 lowered over the trailing 90 days following the Q1'26 beat and guidance raise.)

Guidance AccuracyStrong — Palantir has beaten and raised guidance for multiple consecutive quarters; FY2026 revenue guide lifted to $7.65B (+71%) at Q1.

Earnings Surprise Track Record

Q1 2026 Est: $0.28 Act: $0.33 +18%

Q4 2025 Est: $0.18 Act: $0.25 +39%

Q3 2025 Est: ~$0.17 Act: $0.21 +~24%

Q2 2025 Est: ~$0.14 Act: ~$0.16 (est.) beat (revenue beat)

Beat Rate4 of 4 recent quarters — a consistent string of EPS and revenue beats

Insider Activity (90 Days)

Net Buying/SellingNet selling — $0 in open-market purchases; >$300M+ in disclosed insider sales

Sell/Buy Ratio~9 sells per 1 buy over trailing 3 months

Cautious. The complete absence of open-market insider buying while the stock sits near multi-month lows — combined with large, repeated founder/executive sales — is a negative confidence signal, even allowing that most sales run through scheduled 10b5-1 plans.

Mar 2026: Peter Thiel sold >2M shares (~$280M) at ~$141-147. Feb 20, 2026: Stephen Cohen ~$43.7M; CTO Shyam Sankar >$22M. CEO Alex Karp has sold >$4B across 2024-2025. No notable insider buying at current levels.

Peer Comparison

Relative Valuation vs. Competitors

Company	P/E	EV/Rev	Rev Growth	Gross Margin
Palantir	~127x (fwd ~75x)	~50x	+85%	~84%
Snowflake	n/m (loss)	~12-16x	+28%	~67%
Datadog	~263x	~11x	+32%	~80%
ServiceNow	profitable	~7-9x	+22%	~78%

PLTR carries by far the richest revenue multiple in software — ~50x EV/revenue versus single-digit-to-teens for SNOW, DDOG and NOW — but it also pairs the fastest growth (+85%) with a top-tier ~84% gross margin and, unlike Snowflake, GAAP profitability. The premium is partly earned: a 145% Rule of 40 and 57% FCF margins are genuinely rare. But it leaves essentially no valuation cushion. Mature, profitable peers like ServiceNow and Salesforce trade at a fraction of PLTR's multiple, framing the central risk: even flawless execution can underwhelm if the multiple normalizes toward the peer set.

Valuation

Price Targets & Scenarios

Scenario	Price Target	Assumptions	Probability
AI-Ops Compounder Re-Rates	$200	AIP land-and-expand keeps US commercial growth >100%, government wins (Army $10B, allied defense) scale, FY2026 revenue beats the $7.65B guide, and the market rewards a 145% Rule of 40 with a premium multiple again. Approaches the Street-high target zone.	35%
Great Business, Multiple Resets	$145	Revenue grows ~70%+ into FY2026 guidance and FCF margins hold near 55%, but the multiple settles toward ~40x EV/revenue as AI-software valuations normalize. Stock drifts back toward the consensus mean and the 200-day region.	45%
Growth Decel + Multiple Compression	$90	Growth steps down toward ~60%, an AI-capex/SaaS risk-off persists, continued heavy insider selling weighs on sentiment, and a still-extreme multiple compresses hard. Breaks below the $106.37 52-week low toward bear-case PTs near Morningstar fair value / sub-$100.	20%

Probability-Weighted Target: $153 (~36% upside vs $112.93)

$153

Weighted

Bull $20035%

Base $14545%

Bear $9020%

Analyst Consensus

BofA Securities

$255

Buy

Rosenblatt

$225

Buy

Loop Capital

$220

Buy

HSBC

$151

Hold

Net bullish but deeply split — ~19 Buy / 11 Hold / 2 Sell across ~32 analysts. Average 12-mo PT ~$182.75 (range $70-$255), implying ~+62% upside from $112.93. The unusually wide dispersion captures the core debate: world-class fundamentals versus an extreme valuation. 90-day EPS revisions skew positive (19 raised, 0 lowered) after the Q1'26 beat.

Technical

Key Levels & Options Intelligence

S/RSupport & Resistance

52-Week High (late 2025)

$207.52

200-Day Moving Avg

$158.85

50-Day Moving Avg

$136.46

Resistance Cluster

$120-122

Near-Term Resistance

$114-115

Current Price (Jun 26, 2026)

$112.93

Support (Hull MA)

$108.57

52-Week Low

$106.37

OptOptions & Sentiment

RSI (14): ~34 — near oversold; momentum weak after six straight down sessions
MACD: ~ -6.75 — sustained sell signal; price below both the 50- and 200-day MAs
Implied Volatility (30d): ~68.8% — elevated; IV rank ~47, mid-range vs PLTR's own history
Put/Call Ratio: Volume 0.73 (slightly bullish) · Open interest 0.96 (near neutral/bearish)
Short Interest: ~76.4M shares · ~3.6% of float — modest for a name this volatile
Beta (5Y): ~1.52 — high-beta AI/software proxy, amplifies risk-on/risk-off swings
Drawdown from Peak: −46% from the $207.52 52-week high; ~40% YTD into late June 2026
Key Floor: $106.37 52-week low, then psychological $100 — a break opens the bear-case path

Risk & Ownership

Risk Assessment & Insider Signals

!Risk Factors

Valuation / Multiple Compression: At ~50x EV/revenue and ~71-78x forward earnings, PLTR is the richest large-cap in software with essentially no margin of safety. It has already fallen ~46% from its high amid an AI/SaaS de-rating. Any normalization toward even ~30-40x EV/revenue — still a huge premium — implies meaningful downside regardless of operational success. Morningstar fair value sits near $153.
Growth Deceleration Sensitivity: With ~85% growth embedded in expectations, even a step-down toward 70-80% reads as a disappointment. The bar rises every quarter; US commercial (+133%) faces tougher comps in 2027, and international commercial (+26%) is already a soft spot. A single sub-consensus print could compress the multiple sharply.
Heavy Insider Selling / No Buying: Insiders are selling ~9-to-1 over buys with no open-market purchases. Peter Thiel sold ~$280M in March 2026; Cohen (~$43.7M) and Sankar (>$22M) sold in February; Karp has sold >$4B across 2024-25. Much is via 10b5-1 plans, but the complete absence of insider buying near multi-month lows is a poor confidence signal.
Government Concentration & Procurement Risk: Government is still roughly half of revenue, exposing PLTR to contract timing, budget cycles, continuing-resolution risk and procurement politics. The $10B Army ceiling is a bookings opportunity, not guaranteed spend; large lumpy federal awards can slip quarters and add revenue volatility.
Stock-Based Compensation & Dilution: SBC runs roughly $1.6-1.7B annualized, a persistent dilution headwind and the key gap between GAAP and 'adjusted' margins. Share count near ~2.4B keeps growing; rich adjusted metrics flatter the picture relative to fully-diluted GAAP economics, a recurring bear talking point.
Competition from Foundation-Model Labs & Data Platforms: OpenAI/Anthropic moving up the stack, plus Databricks, Snowflake Cortex, C3.ai and the defense-tech/IT-prime ecosystem (Anduril, Booz Allen, SAIC), all encroach on the AI-ops layer. Palantir's ontology + accreditation bundle is a real moat, but Morningstar flags 'very high uncertainty' on TAM and competitive durability.

OOwnership & Insider Signals

Institutional Ownership: ~55-56% of shares held by institutions as of mid-2026 — large index and growth funds dominate, with retail an unusually large ~40% of the register, contributing to the stock's high volatility and momentum swings.
Insider Ownership: ~5-7.5% held by insiders/founders. Founder-led with concentrated voting power via the founder class structure (Karp, Thiel, Cohen), giving management durable control of strategic direction.
Insider Selling — Heavy: Sell/buy ratio ~9:1 over trailing 3 months. Peter Thiel sold >2M shares (~$280M) in one March 2026 day; Stephen Cohen ~$43.7M and CTO Shyam Sankar >$22M on Feb 20, 2026; CEO Alex Karp a continued seller. Largely 10b5-1, but no offsetting open-market buying.
Founder / CEO Position: CEO Alex Karp and co-founders retain meaningful economic and outsized voting stakes despite ongoing sales; the founder-control structure entrenches the current strategy and management team.
Float & Liquidity: ~2.40B shares outstanding, ~$270B market cap, with a deep, highly liquid options market. High retail participation and ~1.5 beta make the name a high-torque proxy on AI-software sentiment.
Short Interest: ~76.4M shares short, ~3.6% of float — modest given the volatility, suggesting the bear case is expressed more through valuation/options than outright shorting.