Predicting Palantir's Stock Value in the Coming Five Years
Palantir Technologies Q1 Revenue Soars, but Stock Growth Remains Challenging
Palantir Technologies, a significant AI stock in the market, has reported impressive growth in its Q1 revenue. The U.S. commercial revenue jumped an impressive 71%, totaling $255 million, while the total commercial revenue grew 33% to reach $397 million.
However, the stock price of Palantir Technologies trades for 106 times sales, a level that's practically unheard of for a company growing as "slowly" as Palantir is. This high valuation has raised questions among investors, who may find better opportunities in other AI stocks with more reasonable price-to-sales ratios.
The company's management expects Q2 revenue growth of 38%, and Palantir's growth could accelerate if international commercial revenue starts to pick up. Europe is a significant region to watch for Palantir's international growth.
Despite the strong growth, Palantir's international commercial revenue growth is currently slow. For the full year, Palantir expects revenue of $3.896 billion, representing a 36% increase. If Palantir is to return to a still very expensive but far more reasonable 25 times sales, its stock price would have to remain flat and its revenue would have to increase by 422%.
Accelerating Palantir's revenue growth from the mid- to high-30% range all the way to 50% would take approximately 3.5 years of growth. This growth rate was the same in the U.S. and internationally for Palantir's government revenue, which increased 45% year over year to $487 million in Q1.
It's worth noting that companies in the U.S. market with similar AI success and potential as long-term investments include NVIDIA, Super Micro, Idexx Laboratories (veterinary diagnostics leader), Zscaler (cloud IT security specialist), and DoorDash (home delivery platform). Palantir still outperforms some of these in 2025.
Investors should keep a close eye on Palantir's international growth as a key indicator of the company's future performance. With its impressive Q1 results and promising outlook, Palantir Technologies continues to be a significant player in the AI market.
Additional Information
- Palantir's U.S. commercial revenue jumped 71% in Q1, totaling $255 million.
- Most software companies trade between 10 and 20 times their sales, with the best-performing companies reaching a multiple of 30 times sales.
- Palantir's total commercial revenue grew 33% in Q1, bringing it to $397 million.
- Palantir's management expects Q2 revenue growth of 38%.
- Palantir's growth could accelerate if international commercial revenue starts to pick up.
- Europe is a significant region to watch for Palantir's international growth.
- Investors may find better opportunities in other AI stocks that don't have the same high expectations built into their prices.
- Palantir Technologies (PLTR) is a significant AI stock in the market.
- Palantir's stock price of trades for 106 times sales, a level that's practically unheard of for a company growing as "slowly" as Palantir is.
- Palantir's international commercial revenue growth is currently slow.
- Palantir's growth rate was the same in the U.S. and internationally for its government revenue.
- For the full year, Palantir expects revenue of $3.896 billion, representing a 36% increase.
- For Palantir to return to a still very expensive but far more reasonable 25 times sales, its stock price would have to remain flat and its revenue would have to increase by 422%.
- Accelerating Palantir's revenue growth from the mid- to high-30% range all the way to 50% would take approximately 3.5 years of growth to return to a more sustainable level.
- The growth of Palantir's stock over the next five years is expected to be relatively flat due to the already high expectations built into the stock's price.
- The stock price of Palantir Technologies trades for 106 times sales, a level that's practically unheard of for a company growing as "slowly" as Palantir is.
- Companies in the U.S. market with similar AI success and potential as long-term investments like Palantir Technologies include NVIDIA, Super Micro, Idexx Laboratories (veterinary diagnostics leader), Zscaler (cloud IT security specialist), and DoorDash (home delivery platform), with Palantir still outperforming some of these in 2025.
- Palantir's government revenue increased 45% year over year to $487 million in Q1.
