Palantir (PLTR.us), the maker of defensive software, surged close to 31% yesterday after the company beat Q4 earnings expectations, with the stock closing at $21.87. This is the company's largest one day percentage gain on record. In the past the market had concerns about future deals with the government, but this has been overlooked with the market positively receiving the company's success in its commercial deals for its analytics software.
Palantir's revenue was up 20% from a year ago, coming in at $608m. Wall Street's estimate was $603m. Commercial revenue was up 32% from a year ago at $284m, beating the Wall Street estimate of $271m. Government revenue increased by 11% to $324m which was below analyst expectations of $333m.
The prevailing geopolitical landscape, marked by turbulence in the Middle East, conflict in Ukraine, and a complex dynamic between the United States and China, is poised to be advantageous for Palantir in the near future.Company CEO Alex Karp said that "The parts of the government that are preparing to go to war are either using Palantir or are about to use Palantir" and that the "results reflect both the strength of our software and the surging demand that we are seeing across industries and sectors for artificial intelligence platforms, including large language models, that are capable of integrating with the tangle of existing technical infrastructure that organisations have been constructing for years."
In the upcoming March quarter, Palantir envisions its revenue in the ballpark of $612 million to $616 million, slightly below the Wall Street consensus pegged at $617 million.
Nevertheless, the company anticipates adjusted income from operations to fall within the range of $196 million to $200 million, surpassing the consensus estimate of $172 million.
Palantir forecasts 2024 adjusted free cash flow of between $800 million and $1 billion, above consensus at $658 million.
Palantir's green 5-week EMA has crossed above its orange 10-week EMA (black circle) and its RSI has popped back above 50 (black rectangle). The longer the RSI maintains on the bullish side of 50 the greater the underlying positive momentum support and the greater the likelihood of higher prices ahead.
Senior Market Specialist
Russell Shor joined FXCM in October 2017 as a Senior Market Specialist. He is a certified FMVA® and has an Honours Degree in Economics from the University of South Africa. Russell is a full member of the Society of Technical Analysts in the United Kingdom. With over 20 years of financial markets experience, his analysis is of a high standard and quality.