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NetflixAdaptationWidow
#1 Mar 26 2021 05:41pm
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Joined: Oct 25 2006
Gold: 492.78
Let's talk about PLTR.

Position: 312 shares @ $25

Things I like about this company
- Anything AI is going to grow like gangbusters in the next 10 years.
- Big data is quickly becoming the norm rather than the exception for companies at every level
- Software that directly saves companies money is inherently valuable and easily sellable once you have a few success stories.
- Focusing on long-term growth, not short-term gains, and customers of every size.
- Just got set up on AWS, which will be a gateway to helping customers of all levels.
- 1 billion in revenue, 2 billion cash on hand, and 500 million of debt. Pretty good stats for a company with 40% revenue growth since last year.

Things I don't like about this company
- Silicon shortages will continue for at least 2 years, making anything computing expensive.
- They are not profitable and likely won't be for at least another year.
- They are going to be a heavily fluctuating stock. Just in the last few months we've seen highs up to 44 and falls to less than 50% of that value.
- Higher interest rates means growth stocks aren't valuable right now.
- They have a moat that is time-dependent. It takes a long time to develop software like what they've developed, but that doesn't mean a big company like Google couldn't quickly bridge that moat by deploying a lot of resources to doing so.
- I fucking hate owning meme stocks.

You may have seen news about insiders selling off their shares. This is because PLTR has largely not paid their staff with high salaries, but in stock options, and the sale of the stocks from those options has been locked up and have to be sold at essentially random dates to comply with insider trading laws. So this isn't particularly concerning.

If you have any thoughts, positions, or anything please post it! I don't see PLTR as a bankruptcy risk for at least 5-10 years, and I think if they focus on advertising and getting their software in the hands of businesses of all sizes and industries it could easily turn into a multi-trillion dollar powerhouse over the next 10 years.

I'm especially interested in anything I've missed on the down side. If you see a down side to PLTR that I haven't, please let me know!

This post was edited by Thor123422 on Mar 26 2021 05:42pm
S3th
#2 Mar 26 2021 07:16pm
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PLTR long-term investor. My strongest conviction comes from those who use or have used their software or engineers who have looked over the product. Always rave reviews.
NetflixAdaptationWidow
#3 Mar 26 2021 07:26pm
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Quote (S3th @ Mar 26 2021 08:16pm)
PLTR long-term investor. My strongest conviction comes from those who use or have used their software or engineers who have looked over the product. Always rave reviews.


I am very excited that AFAIK they've never had somebody drop their product, and virtually every customer has increased their spending YoY consistently.
Bazi
#4 Mar 26 2021 07:39pm
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I got in at $25 several weeks back. Ballooned like 3$ the week I got it and thought I caught the low

Nopp
ofthevoid
#5 Mar 26 2021 08:05pm
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I owned it at 10 briefly but sold out.

Personally, I think it's overpriced, at a time when valuations on high flyers are really taking a tumble.

Palantir has a price/sales of 37 while Microsoft has a p/s of 11. So Palantir is over 3x the price of Microsoft a company that many would say is at a rich valuation.

Secondly, PLTR has a fairly low customer base. They only have 125 customers and many of their analytics offerings take time to implement and are highly customizable. That's not good for economies of scale. As a company, you want to be able to churn products out in fairly standardized packages. Customization = more input costs.

Thirdly, the company has never been profitable in 18 years of existence. It has never been FCF positive. Its operating profit was negative 1.2 billion dollars and its EPS is -1.20/share most recently.

Fourthly, big data analytics is an up-and-coming field but it's a very crowded space. Extremely competitive and you have some heavyweights in there and competitors springing out of the woodwork daily.

Fifthly, insiders have sold a fuckton of stock in the last few months. That doesn't instill confidence IMO.

Personally, if I was you I would diversify. I don't have a crystal ball, it's possible this goes to 30 or 40 but you should spread your eggs out.

NetflixAdaptationWidow
#6 Mar 26 2021 08:18pm
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Quote (ofthevoid @ Mar 26 2021 09:05pm)
I owned it at 10 briefly but sold out.

Personally, I think it's overpriced, at a time when valuations on high flyers are really taking a tumble.

Palantir has a price/sales of 37 while Microsoft has a p/s of 11. So Palantir is over 3x the price of Microsoft a company that many would say is at a rich valuation.

Secondly, PLTR has a fairly low customer base. They only have 125 customers and many of their analytics offerings take time to implement and are highly customizable. That's not good for economies of scale. As a company, you want to be able to churn products out in fairly standardized packages. Customization = more input costs.

Thirdly, the company has never been profitable in 18 years of existence. It has never been FCF positive. Its operating profit was negative 1.2 billion dollars and its EPS is -1.20/share most recently.

Fourthly, big data analytics is an up-and-coming field but it's a very crowded space. Extremely competitive and you have some heavyweights in there and competitors springing out of the woodwork daily.

Fifthly, insiders have sold a fuckton of stock in the last few months. That doesn't instill confidence IMO.

Personally, if I was you I would diversify. I don't have a crystal ball, it's possible this goes to 30 or 40 but you should spread your eggs out.


I don't think P/S is necessarily a good metric for growth companies.

Low customer base is indeed an issue. Their value in the future will be highly dependent on getting more customers.

Most of their existence has been developing the software, so taking the full 18 years of existence isn't necessarily a good indicator. However, it is currently far from profitable, that's a given.

Big data analytics could easily be overtaken by massive investment by other companies, agreed.

Insiders selling stock in the last few months isn't concerning when you see that most of their compensation for the past 10+ years has been stock options, and they've only been allowed to sell since February 15th. Under those circumstances it's expected to have a huge amount of insider sales immediately following.
TheWhiteTower
#7 Mar 27 2021 05:01pm
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Gold: 1,280.00
168 shares at $10. Plan on holding it for at least a year to see where it goes. Regretting not selling when it was high 30s and rebuy when I it tanked. If it goes under 15 I’ll buy more. Seems like good long term hold
BlemBlem
#8 Mar 29 2021 07:27pm
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50@23
NetflixAdaptationWidow
#9 Apr 7 2021 08:56pm
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Posts: 55,801
Joined: Oct 25 2006
Gold: 492.78
PLTR gets a 89.9 million contract to provide data services to the National Nuclear Security Administration for 5 years.

Also rumors they're being offered a no-bid contract by the military because they are the only ones who are capable of offering the services they are seeking. Just a reddit post, but if it's true it will really reinforce how unique PLTR is in the space they occupy.
KRR
#10 Apr 8 2021 01:44am
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Gold: 1,568.02
Yeh an ok Long term hold

This post was edited by KRR on Apr 8 2021 01:46am
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