Enterprise and government data analytics services provider Palantir Technologies (NASDAQ: PLTR) stock has plummeted nearly (-46%) in 2022. According to its CEO Alex Karp, Palantir thrives in both good and bad times. He claims they predicted inflation and built the Company to had free cash flow, not just growth. However, the Company is growing at 30% and expects revenues to maintain that pace through 2025. Commercial revenues rose 54% adding 40 new customers resulting 86% client growth. Since the Russian Ukraine conflict, the Company has been providing western militaries with needed artificial intelligence software. It’s platform has been used to power refugee relief operations and World Food Programs and Ukraine response. Real-world events are helping drive long-term opportunities. The Company operates on a land and expand model where they win contracts and then expand into more applications and opportunities. CEO Karp stated that what was Amazon AWS (NASDAQ: AMZN) in the last decade, it’s Foundry platform will be in the next. This has been successful in continuing to build its business with the U.S. Army, Department of Defense, and Space Systems. Rising recession risk has not yet be shown to impact data analytics solutions offered by Palantir, indicating it may even be a hedge. Prudent investors looking for exposure in the clandestine cloud-based predictive data analytics segment can watch for opportunistic pullbacks in shares of Palantir.
Q1 Fiscal 2022 Earnings Release
On May 9, 2022, Palantir reported its fiscal Q1 2022 results for the quarter ending March 2022. The Company reported an earnings-per-share (EPS) profit of $0.02 missing consensus analyst estimates for a profit of $0.04. Revenues grew 30.8% YoY to $446.31 million, beating analyst estimates for $443.51 million.
Palantir expects fiscal Q2 2022 revenues between $470 million versus $483.76 million consensus analyst estimates. This is a base case and could rise in response to responding to any geopolitical developments. Palantir expects adjusted operating margin of 20%. Fiscal full-year 2022 operating margin is expected at 27% and expects annual growth to continue at 30% through 2025.
Conference Call Takeaways
Palantir CEO Alex Karp pointed out that trend they believed would happen are happening at an accelerated rate. He continued ramble about the genesis of escapism to the Metaverse without solving problems where inputs are anti-correlated. He stated that Palantir thrives in the good times and bad times. The Company throws off free cash flow and expected inflation. The quality of government revenues are crucial since inflation will suffer from inflation. He continued his expounding the virtues of the Company, “Palantir, we are playing a critical, crucial and much bigger role than we’re allowed to mention or would ever discuss in public and current events. Obviously, commercially, because our partners and other future partners are being disrupted. Their supply chains are disrupted. There’s a threat of a disruption in the broader economy. And we are — and they — many realize that the reality of a truly monumental, epic and horrific disruption in the form of a nuclear attack is much higher than is being reported. But also in the government context where we are playing an outsized role, and we’re very proud of that and we’re proud of the people we’re able to support.” He went on to say that Palantir’s products are on the front line and on the news every day and would someday like to discuss exactly what they’re doing. However, it’s clandestine nature and can’t be revealed. Palantir CFO Shyam Sankar added that Foundry will be the place to build applications of the future, “With Foundry, you’re 90% of the way there on day 1. Software-defined data integration, native multi-tenancy for your applications, the OPIs, version pipelines, applications, artifacts, to just name some of the components, that make Foundry work from the start.”
PLTR Opportunistic Pullback Levels
Using the rifle charts on the weekly and daily time frames provide a precision view of the landscape for PLTR stock. The weekly rifle chart downtrend made a bottom near the $6.57 Fibonacci (fib) level. The weekly 5-period moving average (MA) is rising at $9.70 to attempt a breakout on a crossover through $9.57. The weekly stochastic has a mini pup through the 40-band. The weekly market structure low (MSL) buy triggered on a breakout through $8.58. The weekly upper Bollinger Bands (BBs) sit at $15.07. The daily rifle chart is attempting a breakout as the 5-period MA crosses up through the 15-period MA at $9.64 towards the daily upper BBs at $10.81. The daily 50-period MA support sits at $8.84 and 200-period MA resistance sits at $14.64. Prudent investors can watch for opportunistic pullback levels at the $9.37 fib, $8.58 weekly MSL trigger, $7.79 fib, $7.37, $6.57 fib, $5.55 fib, and the $4.83 fib level. Upside trajectories range from the $12.52 level up towards the $17.22 fib level.