Long-established in the software industry, Palantir Technologies Inc (PLTR, Financial) has enjoyed a stellar reputation. However, it has recently witnessed a daily loss of 1.27%, juxtaposed with a three-month change of 77.64%. Fresh insights from the GF Score hint at potential headwinds. Notably, its diminished rankings in financial strength, growth, and valuation suggest that the company might not live up to its historical performance. Join us as we dive deep into these pivotal metrics to unravel the evolving narrative of Palantir Technologies Inc.
What Is the GF Score?
The GF Score is a stock performance ranking system developed by GuruFocus using five aspects of valuation, which has been found to be closely correlated to the long-term performances of stocks by backtesting from 2006 to 2021. The stocks with a higher GF Score generally generate higher returns than those with a lower GF Score. Therefore, when picking stocks, investors should invest in companies with high GF Scores. The GF Score ranges from 0 to 100, with 100 as the highest rank.
- Financial strength rank: 8/10
- Profitability rank: 3/10
- Growth rank: 8/10
- GF Value rank: 1/10
- Momentum rank: 3/10
Based on the above method, GuruFocus assigned Palantir Technologies Inc the GF Score of 64 out of 100, which signals poor future outperformance potential.
Understanding Palantir Technologies Inc Business
Palantir Technologies Inc is an analytical software company that focuses on leveraging data to create efficiencies in its clients' organizations. The firm serves commercial and government clients via its Foundry and Gotham platforms, respectively. Palantir works only with entities in Western-allied nations and reserves the right not to work with anyone that is antithetical to Western values. The Denver-based company was founded in 2003 and went public in 2020. With a market cap of $324.13 billion and sales of $3.12 billion, Palantir Technologies Inc has an operating margin of 13.02%, reflecting its ability to generate profit from its operations.
This is the income breakdown of Palantir Technologies Inc: 
Profitability Breakdown
Palantir Technologies Inc's low Profitability rank can also raise warning signals. Despite its strong market presence and innovative platforms, the company's profitability rank of 3/10 indicates challenges in converting its operations into substantial profits. This low score suggests that while Palantir Technologies Inc is capable of generating revenue, its ability to maintain cost efficiency and maximize profit margins is limited. This could be a significant factor in its potential underperformance in the future.
Next Steps
In conclusion, the GF Score highlights Palantir Technologies Inc's potential for underperformance, given its financial strength, profitability, and growth metrics. While the company has a strong foundation and innovative offerings, its current financial indicators suggest that it may face challenges in achieving the high returns expected by investors. As the market continues to evolve, it will be crucial for Palantir Technologies Inc to address these areas to enhance its performance and meet investor expectations.
GuruFocus Premium members can find more companies with strong GF Scores using the following screener link: GF Score Screen
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
