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Should You Buy Palantir Stock Ahead of Q3 Earnings Report?
ZACKSยท 2025-10-29 17:36
Core Insights - Palantir Technologies Inc. (PLTR) is set to report its third-quarter 2025 results on November 3, with expected earnings of 17 cents per share, reflecting a 70% increase year-over-year, and total revenues projected at $1.1 billion, indicating a 50.7% growth from the previous year [1][6]. Financial Performance - The consensus estimate for Government revenues is $602.5 million, representing a 47.6% year-over-year growth, while Commercial revenues are expected to reach $493.7 million, indicating a 55.6% increase [5][6]. - Palantir has a strong history of earnings surprises, having exceeded the Zacks Consensus Estimate in three of the last four quarters, with an average earnings surprise of 13.2% [2]. Valuation and Market Position - Palantir's stock has increased by 151% year-to-date, significantly outperforming the industry average growth of 22% [7]. - The current valuation multiples for Palantir are notably high, with a 12-month EV-to-EBITDA ratio of 1122X compared to the industry average of 15.27X, and a forward 12-month Price/Earnings ratio of 229.14X against the industry's 38.98X [8]. Investment Considerations - The company demonstrates strong growth momentum driven by demand in both government and commercial sectors, alongside consistent profitability improvements [9]. - Despite the positive outlook, the current valuation suggests limited near-term upside potential, leading to a "Hold" stance ahead of the earnings report [9].