A Right Jolly Gamble: Two Stocks to Beat Palantir

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Now, listen here. Palantir Technologies, a name that sounds suspiciously like a villain from a spy novel, has puffed itself up rather nicely, hasn’t it? Nearly doubled in a year, they say. A monstrous market value of $360 billion! But don’t you worry your little socks off. I’ve been peering into my crystal ball – a rather dusty thing, it is – and I reckon two other chaps, Shopify and AppLovin, can give Palantir a good run for its money. A proper thrashing, even, within five years. Let’s have a look, shall we?

  • Shopify, currently worth a mere $172 billion (pocket change, really), needs to leap a good 110% to reach $361 billion. That’s about 16% a year, which, for a stock, is a bit like a particularly energetic grasshopper.
  • AppLovin, at $160 billion, needs a slightly bigger jump – 126% – to hit the same mark. That’s roughly 18% a year. A rather plump return, wouldn’t you say?

So, what’s the secret sauce? What makes these two different from the other boring, predictable stocks? Let’s unravel it, shall we?

1. Shopify

Shopify, you see, is a bit like a magical workshop for merchants. It lets them build shops – not with bricks and mortar, mind you, but with clicks and whirs – and sell their wares all over the place. Physical shops, online shops, even those sneaky little pop-up shops on social media. It’s a clever contraption, and it’s getting ever more sophisticated.

The clever bods at Gartner, a consultancy firm filled with people who like ticking boxes, have declared Shopify a “leader” in digital commerce. They say it’s fast, reliable, and good for businesses of all sizes. Which is a rather polite way of saying it’s simply brilliant. They’re gaining traction with bigger companies too, adding fancy analytics and customizable storefronts.

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2. AppLovin

AppLovin is a bit of a mischievous character, you see. It develops ad tech software. Initially, it focused on mobile games, helping developers market their creations. But now, it’s expanding into web advertising with a new self-service platform. A platform that will eventually automate everything – from creating campaigns to optimizing them. A truly ambitious undertaking!

AppLovin has something called Axon, a “best-in-class machine learning ad engine,” according to Morgan Stanley. A rather grand title, isn’t it? Axon is excellent at targeting campaigns because AppLovin also owns Max, a mediation platform that lets publishers sell ad space across multiple networks. The data gathered from Max is used to train the AI models that power Axon. A clever little feedback loop, wouldn’t you say?

Apparently, AppLovin delivers a 45% higher return on ad spending than Meta Platforms, and a whopping 115% higher return than TikTok, Pinterest, Snap, and YouTube. That’s quite a feat! Mark Giarelli at Morningstar says Axon gives AppLovin a “durable competitive advantage.” A fancy way of saying it’s very good at what it does.

In 2025, AppLovin reported advertising revenue of $5.4 billion – a 70% increase! And net income jumped 116% to $3.4 billion. A truly spectacular result!

Wall Street expects earnings to grow at 44% a year through 2027. That makes the current valuation look reasonable. But even if AppLovin’s earnings grow at a more conservative pace of 30% a year, its market value could reach $365 billion, and the valuation will fall to 30 times earnings. A rather tempting proposition, wouldn’t you say?

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2026-03-13 11:12