What happened
Shares of Palantir Technologies (PLTR +2.19%) are starting the week with a day of strong gains. The data analytics company's share price was up roughly 7% as of 1:15 p.m. ET on Monday. Meanwhile, the Nasdaq Composite index had gained roughly 2.4%.
Tech stocks have been under pressure early in 2022, and it looks like some investors are now aiming to take advantage of recent sell-offs. There doesn't appear to be any company-specific news behind Palantir's gains today, but the broader market is rallying, and many growth-dependent tech stocks are enjoying strong rebound momentum.
Image source: Getty Images.
So what
The market is off to rocky start this year, but it looks like stocks are on track to close out January with a day of gains. Momentum for the market at large, and tech stocks in particular, is helping to push Palantir higher in Monday's session.
With the company valued at growth-dependent multiples and operating in a relatively young corner of the data analytics industry, Palantir has been a battleground stock in the cloud-based software-as-a-service category. Shares have seen big sell-offs on days when bearish sentiment has gripped the market, but the stock also tends to post outsize gains on days when the Nasdaq is in the green.
Now what
With today's gains, Palantir now has a market cap of roughly $27.3 billion and is valued at approximately 13.7 times this year's expected sales. Beyond momentum for the broader market affecting the stock, there's potentially a much bigger pricing catalyst on the near horizon. The company will likely report fourth-quarter earnings results in February, and performance will probably have a big impact on the narrative surrounding the stock.
With its last update, Palantir management guided for fourth-quarter sales to climb roughly 30% year over year and reach $418 million. It also targeted an operating margin of 22% for the quarter. For the full-year period, the company expects sales growth of roughly 40%, $1.527 billion in revenue, and adjusted free cash flow of $400 million. Expectations are high, and the market has generally been more risk-averse as of late, but Palantir's valuation also looks less speculative compared to levels across the previous year of trading.
