World news – Here’s why palantir stock is a momentum buy after gaining it

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Palantir (NYSE: PLTR) stocks rose sharply on February 19, 2021. First, the company was upgraded by Christopher Merwin, an analyst at Goldman Sachs (NYSE: GS). The analyst increased the PLTR share from neutral to buy with an accompanying price target of USD 34 (previously USD 13). Bullish investors also hailed the announcement that Cathie Wood, the respected fund manager of Ark Invest, has expanded her company’s position.

The combination of these outings makes it almost certain that Palantir stock will rise at the start of trading on February 22nd becomes. However, is this a temporary bump or the start of a larger trend? One look at the company’s investor presentation suggests that this big data growth company has great momentum that should tone down bearish arguments.

The bulls and bears each have their bearings and are being dug into their positions. Of the eight analysts who currently offer ratings for Palantir, the company has four sales ratings. That is almost unknown.

However, the company’s investor presentation achieved with its fourth quarter results has a lot to offer. And it’s starting to negate one of the more bearish arguments against PLTR stock.

Palantir has been known to burn cash. The company’s earnings report also showed the company posted negative earnings per share of 8 cents. This despite an increase in quarterly sales of 40% compared to the previous year. The $ 322.1 million reported by Palantir exceeded estimates by $ 21 million (adsbygoogle = window.adsbygoogle || []). Push ({});

This is only part of the sales story, however. In 2020, the company’s annual revenue growth for the full year was 47%. The company reported that its top 20 customers’ sales grew 34%. At the same time, the share of the top 20 customers in total sales fell from 67% to 61%.

This means that the company is adding customers and increasing the sales they generate with their existing customers. Both are long-term bullish arguments for Palantir.

There were two projects in the company’s presentation that caught my eye after this week’s events. First, Palantir has a contract with BP (NYSE: BP) to support its Net Zero emissions initiative. Palantir’s foundry system is helping the company optimize the company’s platform, including wind farms, electric charging systems, and solar power generation.

And Palantir has a similar contract with Pacific Gas & Electric (NYSE: PCG) to optimize its power grid. Both projects sound exactly like a solution that a state like Texas may need very soon.

Indeed, the need to optimize a power grid that includes « all of the above » portfolio of energy sources can be a catalyst for Palantir.

Another reason why Palantir polarizes is that it works a lot with government agencies, roughly 56% of its business to be precise. And the value of these contracts can be colored depending on where an investor is on the political spectrum.

Let me give you two examples. The company’s Gotham platform has been credited with helping the Central Intelligence Agency locate and ultimately kill Osama Bin Laden. Second, it won contracts with local police forces and the US Immigration and Customs Service (ICE).

This leads some Palantir Bears to view the company as committed to a major right-wing conspiracy. Especially since one of the founders of Palantir is Peter Thiel, who is closely connected to Donald Trump.

But that would be an over-simplification of the network cast by Palantir. In fact, the company’s current CEO, Alex Karp, was a staunch supporter of Hillary Clinton. This is borne out by the fact that while the US government reduced the use of Palantir’s advisory services during the Obama administration, it did not abandon it entirely.

As I mentioned at the beginning of this article, the Palantir should -Share rise higher. And it seems to have the attention of the hedge fund community, which means it will likely turn into a momentum buy.

There are times when you should be wary of momentum games. In the case of Palantir, however, the company looks like it is increasing and diversifying its revenue base. And ultimately, any objections to the company’s « penchant for secrecy » should be resolved once it’s a publicly traded company.

If you’re looking for the next hot growth market, a market at the intersection of several worldly trends, you are just right in the EV market. Electric vehicles. It may not sound like much, but the days of EV as a fringe market are over.

Think about it. An average of 90 million vehicles are sold annually. That’s units, not dollars, total vehicle sales were over $ 3.1 trillion in 2019, and the number is expected to grow over the long term.

The EV market accounts for less than 3% of global vehicle sales but is growing. EV is projected to account for more than 50% of the total car fleet by 2050, and that goal could be achieved much sooner as battery technology advances.

When it comes to the EV market, it’s a rising tide lifting all ships. Kind of market, but there are still some clear winners to focus on.

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