tl;dr
Palantir Technologies has entered the top 20 most valuable U.S. companies with a market capitalization of $375 billion, surpassing firms like Home Depot and Procter & Gamble. Its stock has more than doubled this year, driven by growth in AI projects and U.S. government contracts. Founded in 2003, Pa...
Palantir Technologies has surged into the ranks of the 20 most valuable U.S. companies, marking a significant milestone in its rapid stock ascent. On Friday, the company’s shares climbed over 2%, pushing its market capitalization to $375 billion, surpassing giants like Home Depot and Procter & Gamble. Already ahead of Bank of America and Coca-Cola in market value, Palantir’s stock has more than doubled this year amid growing investor enthusiasm over its artificial intelligence ventures and deeper connections with the U.S. government.
Since its inception in 2003 by founders including Peter Thiel and CEO Alex Karp, Palantir has steadily expanded its client base. The company’s revenue from U.S. government contracts rose sharply, up 45% to $373 million in its latest quarter, contributing to a 39% overall sales increase to $884 million. Palantir is scheduled to release its next earnings report on August 4. Earlier this year, it vaulted past Salesforce, IBM, and Cisco to become one of the top 10 U.S. tech companies by market capitalization.
Despite these impressive gains, investors should note that Palantir’s stock trades at a lofty valuation, with a forward price-to-earnings ratio of 273 times, according to FactSet. This makes it one of only two companies in the top 20 U.S. by market cap with triple-digit P/E ratios, alongside Tesla at 175. With total revenue of $3.1 billion over the past year, Palantir remains significantly smaller in sales compared to its peers. For instance, Mastercard, valued at $518 billion, reported sales near $29 billion in the last four quarters, illustrating the high expectations baked into Palantir’s stock price.