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Investing.com - Palantir Technologies Inc . (NASDAQ:PLTR), now commanding a market capitalization of $405 billion, received a reiterated Market Perform rating from Raymond (NSE:RYMD) James following its second-quarter 2025 financial results, which exceeded expectations across multiple metrics. According to InvestingPro data, the stock has delivered an impressive 112% return year-to-date, trading near its 52-week high.
The data analytics company reported a 7% revenue beat for Q2, with U.S. commercial growth surging 93% and adjusted EBIT exceeding estimates by approximately 15%. Management raised its full-year guidance to a midpoint of $4.15 billion in revenue, compared to consensus estimates of $4.05 billion, while also increasing its free cash flow expectation to $1.9 billion from $1.7 billion. The company’s impressive 80% gross margin and strong liquidity position, with a current ratio of 6.49, underscore its operational efficiency.
Key performance indicators showed robust momentum, with U.S. commercial total contract value reaching $843 million, up 4% quarter-over-quarter and over 222% year-over-year. The company’s customer count grew 43% year-over-year to 849, while net dollar retention reached 128%, indicating strong expansion within existing accounts.
Palantir’s top 20 customers generated average trailing twelve-month revenue of $75 million per customer, a 30% increase year-over-year. The company also demonstrated exceptional efficiency, achieving a Rule 40/50 metric of 94, while management discussed potential for 10x revenue growth with simultaneous headcount reduction.
Despite acknowledging Palantir’s impressive performance and future potential, Raymond James maintained its Market Perform rating, citing valuation concerns as the stock has expanded from 7x sales in 2023 to 74x sales currently, though the firm noted that "fundamental momentum is only gathering steam." InvestingPro analysis suggests the stock is currently overvalued, trading at a P/E ratio of 689x. For deeper insights into Palantir’s valuation metrics and 20+ additional ProTips, explore the comprehensive Pro Research Report available on InvestingPro.
In other recent news, Palantir Technologies Inc. reported impressive second-quarter earnings with revenue reaching $1.0 billion, surpassing consensus estimates of $939 million. This marks a 48% growth from the previous quarter, significantly accelerating from the 39% growth recorded earlier in the year. The company also reported an adjusted operating income of $464 million, exceeding expectations of $404 million, and improved its operating margin to 46%. Following these results, several financial firms adjusted their outlooks on Palantir. Cantor Fitzgerald raised its price target to $155 from $110, maintaining a Neutral rating, while Baird increased its target to $170 from $100, also keeping a Neutral stance. Loop Capital raised its target to $180, highlighting strong AI growth and maintaining a Buy rating. UBS adjusted its target to $165 from $110, noting Palantir’s continued revenue growth acceleration. William Blair reiterated a Market Perform rating, underscoring the company’s strong quarterly performance.
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