We're just weeks away from Palantir's (PLTR 1.26%) fourth-quarter financial report, and to call the stock divisive might well be an understatement. Bulls insist the company is the perfect combination of software-as-a-service (SaaS) and artificial intelligence (AI) wrangler. Bears point to the stock's stratospheric valuation and walk away shaking their heads.
Calling Palantir "Wall Street's most hated stock" isn't much of a stretch. Of the 26 Wall Street analysts who have issued an opinion, only 23% rate the stock a buy or strong buy, with the other 77% taking a hard pass.
It's safe to say the debate will rage on for years, but in the short term, I think Palantir is about to surprise everyone.
Image source: Getty Images.
An object in motion tends to stay in motion
As most science buffs know, Sir Isaac Newton's First Law of Motion states that an object in motion tends to stay in motion, unless acted upon by an external force. Put another way, things continue to move in the same direction and the same speed until something comes along to change that. I believe such is the case with Palantir.
Let's add some numbers for context. Palantir's revenue has grown more than 700% since its 2019 IPO, fueling net income growth of 1,320%. This combination of runaway sales and expanding profit sets the stage for future growth.
What's even more telling is that its revenue growth has accelerated in each and every quarter going back to mid-2023, soon after it released its Artificial Intelligence Platform. The magic of this AI system is that it integrates with existing enterprise business systems -- sales, manufacturing, shipping, finance, etc. -- and provides real-time solutions to everyday business challenges.
NASDAQ: PLTR
Key Data Points
When Palantir reports its Q4 results on Feb 2, management is guiding for revenue of roughly $1.33 billion, representing year-over-year growth of 61%. Furthermore, the company has raised its full-year outlook for U.S. commercial revenue -- which includes AIP -- to 104% growth. Given that Palantir has historically beaten expectations, those estimates are likely conservative.
Given its track record, I think Palantir's about to surprise everyone.
