The Growth Stock Everyone Missed📉

[View in browser]( [The Spill Logo] BROUGHT TO YOU BY: [Logo]( Proprietary Data Insights Financial Pros’ Top IT Services Stock Searches in the Last Month Rank Ticker Name Searches #1 [PLTR]( Palantir Technologies Inc Cl A 105 #2 [CRWD]( Crowdstrike Holdings Inc 57 #3 [CRM]( Salesforce.com Inc 41 #4 [TWLO]( Twilio 36 #5 [DOCU]( Docusign Inc 35 #ad [It's time you learn about Alternative Investments!]( Brought to you by [tastytrade]( [tastytrade Boosts Their Bonus]( [tastytrade - tastytrade Boosts Their Bonus]( Stock traders are getting a better deal from tastytrade. They just raised their bonus offer. Now, raders who open and fund a new account could get up to $5,000. That’s a big bonus. And tastytrade offers more than just a cutting-edge trading platform. Get dedicated, experienced support. Live in-platform video feed of real traders discussing the market. Trade options and futures with low commissions. That’s trading with more. Come see for yourself why you should make your move. [Learn More]( The Growth Stock Everyone Missed📉 U.S. Federal government spending increased between 8.2% per year over the last five years. No wonder Palantir (PLTR) is doing so well. With over half its revenues coming from federal contracts, Palantir has grown 28.5% per year over the past three years. But what caught our attention was the unusual search volume we saw on Monday, according to our TrackStar data, coupled with a surge in options activity. Data from [tastytrade](Sponsor showed heavy trade volume at the $20 call options, implying some bullish bets by traders. Interestingly, these bets applied to expiration dates before and after the earnings on February 5th. This implies traders expect the stock to move higher before the earnings call and stay higher. All of this came on as the stock pushed aggressively higher on Monday. There’s been a lot of hype around this company, which Jefferies downgraded, citing that very reason. But as we looked under the covers, we saw a lot of reasons investors want to own this stock over the long haul. Palantir’s Business When the government wants big data analytics, they turn to Palantir. The company’s category-leading software enables organizations to create and govern AI insights and analysis. Their key platforms include: - Foundry: Recognized as a leader in AI/ML platforms by independent research firms, Foundry is designed to integrate disparate data, AI, and ML models. It helps build custom operational applications, thereby assisting organizations in transforming raw data into structures suitable for analysis. - Gotham: The platform is designed to integrate, manage, secure, and analyze an organization's data. - Palantir Artificial Intelligence Platform (AIP): AIP is a decision-centric system integrating AI with enterprise data, logic, and action. Ontology powers the AIP, providing a comprehensive, unified view of an organization's data. - Apollo: An extensible, scalable platform that manages and deploys software, encoding operational best practices that have been refined over time. Although the U.S. Government represents Palantir’s biggest client, U.K. customers make up 11% of total sales, with the rest of the world at 27%. Non-government sales represent 41% of revenues. Interestingly, Palantir takes hard stances on ethics and politics. They’ve come out in support of Israel and refuse to serve the Chinese government or its communist party. While that might hurt a typical retail business, it has negligible effects on them as a government contractor. Financials [Financials] Source: Stock Analysis Palantir’s revenues continue to rise at a double-digit pace as margins continue to improve. In the last 12-month period, the company turned a P&L profit while increasing its free-cash-flow margin to 22.3%. Although Palantir holds very little debt, its outstanding shares climbed from 1.8 billion to 2.2 billion from 2020 to today. However, management plans to begin a share repurchase of $1 billion worth of stock, or roughly 56 million shares, representing 2.5% of the total share count. We see cash flows continuing to increase as capex remains low while operating cash flows climb close to $500 million per year. Valuation [Valuation] Source: Seeking Alpha Palantir’s P/E metrics don’t make it look that appetizing. Yet, its price-to-cash flow at 74.6x isn’t too shabby when you consider they likely doubled cash flow from 2022 to 2023. And other than Salesforce (CRM) and DocuSign (DOCU), Palantir’s price-to-cash flow is in line with Crowdstrike (CRWD) and Twilio (TWLO). But do Palantir’s growth metrics support these lofty valuations? Growth [Growth] Source: Seeking Alpha With steady double-digit growth, increased government spending, and expansion into new markets, we expect Palantir’s sales to keep climbing at a similar pace for the next 3-5 years. Right now, the company trades at 65.2x next year’s operating cash flow, implying a 14% growth in operating cash flow. While we think this is probably overly conservative, we do expect the company’s new growth to come from the private sector which will cost more. Profitability [Profit] Source: Seeking Alpha Still, you can’t deny the fantastic margins on such a new company, with a net income margin that’s almost as large as Salesforce’s and a free cash flow margin closing in on 25%. [Banks trigger dollar shakeup]( You've likely heard a million different warnings about the changes taking place in America's financial system right now... How the White House plans to take the dollar fully digital... Track and monitor every transaction you make... or ban cash forever. 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[Just click here now for the full story.]([Ad] Our Opinion 9/10 Unlike many hyped AI stocks, we believe Palantir can deliver tremendously profitable growth. However, it may take a while for the markets to realize this. In the interim, traders have placed a high premium on the stock options for Palantir. This creates an ideal opportunity for those looking to own the stock. You can sell cash-secured puts or similar bullish bets…all of which are available on TastyTrade. And right now, you can get deposit bonuses of up to $5,000 when you open and fund a new [tastytrade](Sponsor account. 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