Palantir Technologies Inc. (PLTR) Stock Analysis
Palantir Technologies Inc. (PLTR) Stock Analysis
Analysis from 10-Q filed 2025-11-04. Data as of Q4 2025.
Overall Grade: F (Concerning)
Palantir Technologies Inc. faces challenges in financial performance that warrant careful analysis.
| Metric | Value | Context |
|---|---|---|
| ROIC | 22.6% | Above industry average |
| FCF Margin | 46.9% | Strong cash generation |
| Debt/Equity | 0.0x | Conservative leverage |
Investment Thesis: Strong return on invested capital of 22.6% suggests durable competitive advantages and efficient capital allocation.
Explore Palantir Technologies Inc.: Earnings History | Filing Intelligence | ROIC Analysis
Profitability: Palantir Technologies Inc. earns 22.6% ROIC, Top 25% in Technology
Palantir Technologies Inc.'s trailing-twelve-month ROIC of 22.6% ranks Top 25% in Technology companies (sector median: 5.0%), driven by NOPAT margin of 31.2% combined with asset turnover of 0.6x. Source: 10-Q filed 2025-11-04. Gross margin of 82.4% with operating margin at 31.6% reflects strong pricing power.
| Metric | PLTR | Rating | Context |
|---|---|---|---|
| Return on Invested Capital (ROIC) | 22.6% | Excellent | Above sector median of 5.0% |
| Return on Equity (ROE) | 26.9% | Excellent | Efficient use of shareholder equity |
| Gross Margin | 82.4% | Excellent | Strong pricing power |
| Operating Margin | 31.6% | Excellent | Efficient operations |
Cash Flow: Palantir Technologies Inc. generates $2.1B FCF at 46.9% margin, positive NaN/8 quarters
Palantir Technologies Inc. generated $2.1B in free cash flow (TTM), a 46.9% FCF margin, a margin that ranks Top 5% in Technology. Operating cash flow exceeds net income by 1.3x, indicating high earnings quality. FCF was positive in N/A of the last 8 quarters. Source: 10-Q filed 2025-11-04.
| Metric | PLTR | Rating | Context |
|---|---|---|---|
| Free Cash Flow Margin | 46.9% | Excellent | Excellent cash conversion |
| Free Cash Flow (TTM) | $2.1B | Good | Positive cash generation |
| OCF/Net Income | 1.3x | Excellent | High earnings quality |
| FCF Consistency (8Q) | N/A | Warning | Variable cash flow |
Balance Sheet: Palantir Technologies Inc. at 0.0x leverage
Palantir Technologies Inc.'s debt-to-equity ratio of 0.0x reflects conservative leverage. Source: 10-Q filed 2025-11-04.
| Metric | PLTR | Rating | Context |
|---|---|---|---|
| Debt to Equity | 0.0x | Excellent | Conservative capital structure |
Valuation: Palantir Technologies Inc. trades at 257.6x earnings
Palantir Technologies Inc. trades at a P/E of 257.6x. Free cash flow yield of 0.5% reflects market expectations for growth.
| Metric | PLTR | Rating | Context |
|---|---|---|---|
| P/E Ratio | 257.6x | Warning | Premium valuation |
| EV/Sales | 92.8x | Warning | Growth premium priced in |
| FCF Yield | 0.5% | Warning | Lower cash yield |
Capital Allocation: Palantir Technologies Inc. returns 0.0% shareholder yield
Palantir Technologies Inc.'s total shareholder yield is 0.0% (dividends + buybacks 0.0%). Source: 10-Q filed 2025-11-04.
| Metric | PLTR | Rating | Context |
|---|---|---|---|
| Total Shareholder Yield | 0.0% | Adequate | Dividend + buyback yield combined |
| Buyback Yield | 0.0% | Adequate | Minimal buyback activity |
| Total Capital Returned (TTM) | $75.0M | Good | Dividends + buybacks returned to shareholders |
Sector Rankings
| Metric | Value | Percentile | vs Median |
|---|---|---|---|
| Return on Invested Capital (ROIC) | 22.6% | Top 25% | 4.5x above |
| Free Cash Flow Margin | 46.9% | Top 5% | 5.5x above |
| Gross Margin | 82.4% | Top 25% | 1.6x above |
| Operating Margin | 31.6% | Top 10% | 6.7x above |
| Return on Equity (ROE) | 26.9% | Top 25% | 5.2x above |
| P/E Ratio | 257.6x | N/A | - |
Financial Scorecard
| Metric | PLTR | Rating | Sector Context |
|---|---|---|---|
| Return on Invested Capital (ROIC) | 22.6% | Excellent | Top 25% of sector (median: 5.0%) |
| Free Cash Flow Margin | 46.9% | Excellent | Top 5% of sector (median: 8.6%) |
| Gross Margin | 82.4% | Excellent | Top 25% of sector (median: 51.1%) |
| Debt to Equity Ratio | 0.0% | Excellent | Conservative capital structure |
| P/E Ratio (Price-to-Earnings) | 257.6x | Warning | High expectations priced in |
| Free Cash Flow Yield | 0.5% | Red flag | Growth-focused valuation |
Frequently Asked Questions
Q: What is Palantir Technologies Inc.'s Return on Invested Capital (ROIC)?
Palantir Technologies Inc. (PLTR) has a trailing twelve-month Return on Invested Capital (ROIC) of 22.6%. This compares above the sector median of 5.0%. An ROIC above 20% indicates exceptional capital efficiency and strong competitive advantages.
Q: What is Palantir Technologies Inc.'s Free Cash Flow Margin?
Palantir Technologies Inc. (PLTR) has a free cash flow margin of 46.9%, generating $2.1 billion in free cash flow over the trailing twelve months. A FCF margin above 20% indicates excellent cash conversion and a high-quality business model.
Q: Is Palantir Technologies Inc. stock overvalued or undervalued?
Palantir Technologies Inc. (PLTR) trades at a P/E ratio of 257.6x, which is above the sector median of N/A. The EV/Sales multiple is 92.8x. Free cash flow yield is 0.5%, reflecting growth expectations priced into the stock.
Q: What is Palantir Technologies Inc.'s revenue and earnings growth?
Palantir Technologies Inc. (PLTR) grew revenue by 56.2% year-over-year. Earnings per share increased by 226.3% compared to the prior year. Double-digit revenue growth indicates strong demand and market share gains.
Q: How does Palantir Technologies Inc. compare to competitors in Technology?
Compared to other companies in Technology, Palantir Technologies Inc. (PLTR) shows: ROIC of 22.6% is above the sector median of 5.0% (Top 15%). FCF margin of 46.9% exceeds the sector median of 8.6% (Top 0% of sector). Gross margin at 82.4% is 31.2 percentage points higher than sector peers. These rankings are based on MetricDuck's analysis of all Technology companies with available SEC filings.
Q: What warning signs should I watch for with Palantir Technologies Inc.?
Palantir Technologies Inc. (PLTR) shows no major financial warning signs based on current metrics. However, investors should always monitor: 1) Margin compression trends, 2) Cash flow consistency, 3) Debt levels relative to cash generation, and 4) Changes in competitive positioning.
Data Source: Data sourced from 10-Q filed 2025-11-04. TTM metrics as of Q4 2025.
Methodology: Financial metrics calculated from SEC 10-K and 10-Q filings using standardized formulas. Sector comparisons use peer group based on SIC code.
Scope: This analysis covers SEC filing fundamentals — profitability, cash flow, balance sheet, and valuation metrics. For analyst estimates and price targets, consult sell-side research.
This analysis is for informational purposes only and does not constitute investment advice.