In today's fast-paced and competitive business landscape, it is essential for investors and industry enthusiasts to thoroughly analyze companies before making investment decisions. In this article, we will conduct a comprehensive industry comparison, evaluating Palantir Technologies PLTR against its key competitors in the Software industry. By examining key financial metrics, market position, and growth prospects, we aim to provide valuable insights for investors and shed light on company's performance within the industry.
Palantir Technologies Background
Palantir is an analytical software company that focuses on leveraging data to create efficiencies in its clients' organizations. The firm serves commercial and government clients via its Foundry and Gotham platforms, respectively. The Denver-based company was founded in 2003 and went public in 2020.
| Company | P/E | P/B | P/S | ROE | EBITDA (in billions) | Gross Profit (in billions) | Revenue Growth |
|---|---|---|---|---|---|---|---|
| Palantir Technologies Inc | 174.50 | 12.35 | 21.02 | 2.91% | $0.09 | $0.52 | 20.78% |
| Salesforce Inc | 64.67 | 4.42 | 7.67 | 2.46% | $2.75 | $7.14 | 10.77% |
| SAP SE | 86.77 | 4.75 | 6.51 | -1.92% | $-0.42 | $5.76 | 8.06% |
| Adobe Inc | 45.64 | 13.85 | 10.98 | 3.88% | $1.21 | $4.59 | 11.32% |
| Intuit Inc | 55.33 | 8.92 | 10.74 | 13.4% | $3.34 | $5.67 | 11.95% |
| Synopsys Inc | 63.28 | 12.43 | 14.29 | 4.23% | $0.41 | $1.15 | 15.2% |
| Cadence Design Systems Inc | 76 | 22.26 | 19.53 | 7.1% | $0.36 | $0.88 | -1.23% |
| Roper Technologies Inc | 39 | 3.19 | 8.95 | 2.17% | $0.73 | $1.18 | 14.36% |
| Workday Inc | 37.72 | 6.88 | 7.48 | 1.32% | $0.14 | $1.5 | 3.52% |
| Autodesk Inc | 49.76 | 24.04 | 8.19 | 16.9% | $0.35 | $1.34 | 3.89% |
| Datadog Inc | 357.88 | 18.48 | 19.37 | 2.02% | $0.06 | $0.5 | 26.89% |
| Ansys Inc | 64.75 | 5.20 | 12.66 | 5.29% | $0.09 | $0.4 | 15.99% |
| AppLovin Corp | 50.54 | 36.31 | 8.25 | 23.28% | $0.45 | $0.76 | 47.9% |
| PTC Inc | 74.23 | 7.22 | 9.50 | 3.98% | $0.21 | $0.49 | 11.23% |
| Tyler Technologies Inc | 107.80 | 6.68 | 10.24 | 1.82% | $0.11 | $0.22 | 8.58% |
| Zoom Video Communications Inc | 22.63 | 2.29 | 4.19 | 2.65% | $0.23 | $0.87 | 3.25% |
| Bentley Systems Inc | 48.12 | 16.73 | 13.83 | 7.74% | $0.12 | $0.28 | 7.43% |
| Dynatrace Inc | 88.88 | 6.82 | 9.67 | 1.93% | $0.04 | $0.31 | 21.11% |
| Manhattan Associates Inc | 72.36 | 56.89 | 14.39 | 20.78% | $0.06 | $0.14 | 15.18% |
| Average | 78.08 | 14.3 | 10.91 | 6.61% | $0.57 | $1.84 | 13.08% |
Through an analysis of Palantir Technologies, we can infer the following trends:
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The current Price to Earnings ratio of 174.5 is 2.23x higher than the industry average, indicating the stock is priced at a premium level according to the market sentiment.
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Considering a Price to Book ratio of 12.35, which is well below the industry average by 0.86x, the stock may be undervalued based on its book value compared to its peers.
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With a relatively high Price to Sales ratio of 21.02, which is 1.93x the industry average, the stock might be considered overvalued based on sales performance.
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With a Return on Equity (ROE) of 2.91% that is 3.7% below the industry average, it appears that the company exhibits potential inefficiency in utilizing equity to generate profits.
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Compared to its industry, the company has lower Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $90 Million, which is 0.16x below the industry average, potentially indicating lower profitability or financial challenges.
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With lower gross profit of $520 Million, which indicates 0.28x below the industry average, the company may experience lower revenue after accounting for production costs.
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The company is experiencing remarkable revenue growth, with a rate of 20.78%, outperforming the industry average of 13.08%.
Debt To Equity Ratio
The debt-to-equity (D/E) ratio is an important measure to assess the financial structure and risk profile of a company.
Considering the debt-to-equity ratio in industry comparisons allows for a concise evaluation of a company's financial health and risk profile, aiding in informed decision-making.
When assessing Palantir Technologies against its top 4 peers using the Debt-to-Equity ratio, the following comparisons can be made:
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Palantir Technologies exhibits a stronger financial position compared to its top 4 peers in the sector, as indicated by its lower debt-to-equity ratio of 0.06.
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This suggests that the company has a more favorable balance between debt and equity, which can be seen as a positive aspect for investors.
Key Takeaways
For Palantir Technologies, the PE ratio is high compared to its peers in the Software industry, indicating potentially overvalued stock. The PB ratio is low, suggesting the stock may be undervalued based on its book value. The PS ratio is high, implying investors are willing to pay a premium for the company's revenue. In terms of ROE, EBITDA, gross profit, and revenue growth, Palantir Technologies lags behind its industry peers, indicating lower profitability and growth potential.
This article was generated by Benzinga's automated content engine and reviewed by an editor.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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