Core Viewpoint - Palantir Technologies is experiencing rapid growth but its stock valuation appears excessively high compared to its earnings potential [1][6][10] Group 1: Business Performance - Palantir's revenue growth accelerated to 48% last quarter, reaching $1 billion, which annualizes to approximately $4 billion [4] - The company signed $2.27 billion in contract value for the period, reflecting a 140% year-over-year increase [5] - U.S. commercial revenue grew 93% year-over-year to $306 million, with 157 deals exceeding $1 million [4] Group 2: Valuation Concerns - Despite strong business performance, Palantir's market cap stands at $425 billion, which is nearly double that of Salesforce, despite generating only 10% of Salesforce's revenue [10] - The price-to-sales ratio for Palantir exceeds 100, indicating a premium valuation compared to other software companies [10] - A reasonable price-to-earnings ratio for recurring revenue software businesses is around 30, suggesting Palantir's current valuation is unsustainable [12] Group 3: Market Limitations - Palantir's addressable market is limited, primarily serving large companies and the U.S. government, which constrains its potential customer base [8][7] - The current market cap does not align with even the most optimistic assumptions about the company's addressable market [8] Group 4: Future Projections - Even under optimistic growth scenarios, Palantir's projected revenue and net income do not support a favorable return on investment from current stock prices [13][14] - The analysis suggests that investors may benefit from trimming, selling, or avoiding Palantir stock at its current valuation [15]