Palantir Technologies(US:PLTR) Xin Lang Cai Jing·2025-07-03 11:54Core Viewpoint - Palantir Technologies is currently overvalued, particularly when considering its price-to-sales (P/S) ratio of 110.30, which is significantly higher than the typical range of 10 to 20 for high-growth stocks [2][6]. Financial Performance - Palantir's revenue has grown by 280% since 2019, but earnings per share (EPS) have decreased by 1.5%, indicating dilution effects [4]. - The company's operating cash flow is reported at $1.335 billion, with actual free cash flow being only $410 million after accounting for stock-based compensation and interest income [4]. - In the period from 2023 to 2024, sales grew by 28.7%, but the actual growth rate was only 22% due to dilution [6]. Valuation Comparison - Compared to C3.ai, which has a more appropriate P/S ratio of approximately 7.03, Palantir's P/S ratio of 79.20 suggests it is overvalued [7][9]. - Palantir's implied market value, based on C3.ai's P/S ratio, is approximately $21.89 billion, while its current market value is $340.42 billion, indicating a significant premium [9]. Market Dynamics - Factors that could potentially overturn bearish arguments include continued market speculation driving up the P/S ratio and stronger future growth that could justify the current valuation [11]. - The company has exclusive contracts and a leading position in the AI sector, which contribute to its high valuation, but analysts question whether these factors justify the premium [9][12].