Kim Bolton Palantir Technologies PLTR-Q SELL Jul 24, 2024

Q1 earnings were 39% YOY, so they have a big bar to leap over in Q2. Some aren't sure they will. You can take profits now, nothing wrong with that, but he's not ready to.

Trading at a crazy 175x PE, though Q1 earnings rose 39% YOY. It's frothy.

Valuation has expanded, business is growing. Look at selling a covered call. The thing is that all that volatility has made the options very expensive. Looking out to September, you can sell a $175 call for $8.15. That's 5% of the current share price for $15 of upside. Worst case is that somebody buys your position at a $15 increase, but you keep the $8.15 no matter what.

It reports Monday. He expects a blow-out, because they're getting tons of repeat business from consumer packaged goods to the Federal government.

Has strong margins and cash flow. Their organic revenue growth is 35% for 2025; hard to find another software company like this. Yes, the PE is rich at 229x and he gets why so many are skeptical. Yes, a pullback is possible.

It reports after the closing bell. Owns a small position. A year ago, they were all-in with AI. They already had a proven track record with government. She expects 38% and 53% revenue and earnings growth this quarter. The chart looks exponential, but it will march higher tomorrow. PLTR is one of the few companies implementing AI, a rare pure-play.

Trading at over 70x EV to revenue. Though it does have a premium in terms of growth rate and profitability, you have to pause and say that some of these valuations have to come back down to earth. Down 20% in the last week. 

No contest. NVDA is the one to own.

NVDA has run up, but fundamentals are outstanding. Clear technical superiority in AI chips. AI infrastructure buildout will keep order books full for a long time. Major beneficiary of AI capex.