Palantir (PLTR): The Operating System for Western Defense & Enterprise
1. Executive Summary
Palantir has successfully crossed the chasm from "Secretive Gov Contractor" to "Enterprise AI Standard." With the launch of AIP (Artificial Intelligence Platform), Palantir has solved the "last mile" problem of LLMs—unsafe hallucination and lack of context—making it the de facto choice for regulated industries.
Key Thesis Points
- US Commercial Explosion: Commercial revenue growth in the US is accelerating (+70% YoY) as "Bootcamps" allow customers to go from zero to use-case in 5 days.
- The Ontology: Palantir's core competitive advantage. It maps data not as rows/columns, but as real-world objects (Factories, Planes, Loans). This makes the data usable by non-technical operators.
- Geopolitical Tailwind: Global instability is a tailwind for Palantir's Government business (Gotham).
2. Business Overview
- Gotham: Decision making for Defense/Intel.
- Foundry: Data integration for Commercial Enterprise.
- Apollo: Continuous delivery for software in disconnected environments (subs, humvees).
- AIP: The generative AI layer on top of it all.
3. Financial Analysis
(See Financials Tab for live data)
- GAAP Profitability: Achieved and sustained, leading to S&P 500 inclusion.
- Rule of 40: Consistently exceeding the Rule of 40 (Growth + Margin).
- SBC: Stock Based Compensation has normalized significantly as a % of revenue.
4. Valuation
PLTR is a "Story Stock" trading at elite multiples.
- Premium: 20x+ Sales is common. Valuation is supported by the unique nature of the asset (no direct competitor).
- Retail Cult: High retail ownership creates volatility but also a high floor during hype cycles.
5. Risks
- Valuation Compression: Any deceleration in US Commercial growth will crush the multiple.
- Government Lumpiness: Large government contracts are unpredictable and "lumpy."