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Sell Palantir Stock, Buy Snowflake?
Forbes· 2025-07-11 12:40
Core Viewpoint - Palantir has experienced significant stock price growth, increasing nearly 15 times since its public debut, while Snowflake's stock has declined by about 10% due to concerns over slowing growth and competition. Despite Palantir's strong performance, Snowflake may present a better investment opportunity at this time due to its growth potential and valuation metrics [1]. Revenue Growth - Snowflake has shown a 3-year average revenue growth rate of 40.3%, compared to Palantir's 23.9%. However, Palantir's recent quarterly sales growth of 39.3% outpaced Snowflake's 25.7%. On a trailing 12-month basis, Snowflake's revenue grew by 27.5% to $3.8 billion, while Palantir's revenue rose by 33.5% to $3.1 billion [3][4]. Profitability and Cash Flows - Palantir's net income for the last four quarters was $571 million, with a net income margin of 18.3%. Its operating cash flow was $1.3 billion, yielding a cash flow margin of 42.8%. In contrast, Snowflake reported a net income of -$1.4 billion, resulting in a net income margin of -36.4%, and an operating cash flow of $833 million with a margin of 21.7% [4]. Balance Sheets - Palantir has a debt of $245 million and a market capitalization of $335 billion, resulting in a debt-to-equity ratio of 0.1%. Its cash accounts for $5.4 billion of total assets, leading to a cash-to-assets ratio of 80.6%. Snowflake's debt is $2.7 billion with a market cap of $71 billion, giving it a debt-to-equity ratio of 3.6% and a cash-to-assets ratio of 47.9% [5]. Market Downturn Resilience - Both companies faced significant stock declines during the 2022 inflation shock, with Palantir dropping over 84% but recovering fully, while Snowflake fell nearly 72% and has not yet regained its previous peak. Palantir's recovery is attributed to its growing profitability and operational improvements [6]. Valuation - Palantir's stock trades at high valuation multiples, with a price-to-sales (P/S) ratio of 107.9 and a price-to-free cash flow (P/FCF) ratio of 255. In comparison, Snowflake has a P/S ratio of 19.2 and a P/FCF ratio of 100.3. Palantir's price-to-earnings (P/E) ratio stands at 589.1, significantly higher than the S&P 500's 26.9 [8][9]. Investment Potential - Palantir's valuation premium is supported by its accelerating revenue growth and strong profitability, particularly from government contracts. Conversely, Snowflake's cloud-native architecture and AI capabilities position it well for future growth, despite current profitability lagging behind Palantir. Snowflake's diversified customer base and sticky product ecosystem may offer a more attractive risk-reward profile for long-term investors [9][10].
Digital Realty Schedules Second Quarter 2025 Earnings Release and Conference Call
Prnewswire· 2025-07-01 20:05
DALLAS, July 1, 2025 /PRNewswire/ -- Digital Realty (NYSE: DLR), the largest global provider of cloud- and carrier-neutral data center, colocation, and interconnection solutions, announced today that it will release financial results for the second quarter of 2025 after the market closes on Thursday, July 24, 2025. The company will host a conference call to discuss these results at 5:00 p.m. ET / 4:00 p.m. CT on Thursday, July 24, 2025. To participate in the live call, investors are invited to dial +1 (888) ...