A Motley Fool contributor says Palantir needs 61% annual revenue growth through 2028 to justify its $445 billion valuation at 40 times earnings; the author says even that would only make the stock reasonably valued, not deliver further returns.
Palantir’s latest-quarter profit margin was 55%, and its shares traded at more than 150 times earnings. At that margin, the writer calculates, $20.2 billion in annual revenue would support a 40-times-earnings valuation, versus $6.15 billion over the past 12 months. Q2 U.S. commercial revenue grew 149%; Wall Street forecasts growth of 84% in Q3 and 49% in 2027, although the writer says analysts have repeatedly underestimated the company.
