Palantir and Amazon: A Question of Prudence

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It has come to pass that shares in Palantir Technologies (PLTR) have enjoyed a most spirited advance – an increase of one hundred and ten percent in the current year – whilst those of Amazon (AMZN) have progressed at a rather more measured pace, amounting to a mere seven percent. Yet, it appears the discerning judgment of Wall Street favours the latter, casting a cautious eye upon the fortunes of the former.

  • Amongst the twenty-nine gentlemen offering their assessments, it is predicted that Palantir might, within the next twelve months, find itself valued at approximately one hundred and eleven dollars per share. A circumstance which, given its present standing of one hundred and fifty-eight dollars, suggests a possible diminution of some thirty percent.
  • A more substantial cohort – seventy-one in number – anticipates a price of two hundred and fifty-two dollars for Amazon, representing a potential increase of fifteen percent from its current valuation of two hundred and nineteen dollars.

Thus, the prevailing sentiment appears to encourage a disposal of Palantir shares and an acquisition of those belonging to Amazon. Let us, then, examine the particulars of each establishment, that the reader may form their own considered opinion.

Palantir Technologies

Palantir has recently presented financial reports of a pleasing nature. The number of those firms placing their trust in Palantir’s services has risen by thirty-nine percent, to a total of seven hundred and sixty-nine, and the amount spent by each established client has increased by twenty-four percent – the sixth consecutive observation of such favourable retention. Consequently, revenue has ascended by thirty-nine percent, reaching eight hundred and eighty-four million dollars, representing the seventh successive acceleration of growth. Profits, calculated upon a non-GAAP basis, have likewise increased, by sixty-two percent, to thirteen cents per share.

Mr. Ryan Taylor, a gentleman holding a position of authority within the company, attributes this commendable performance to “unrelenting demand for AIP,” a novel artificial intelligence platform introduced in the preceding year. Management anticipates this momentum will continue, forecasting a revenue increase of thirty-six percent in the year two thousand and twenty-five. It is, however, reasonable to suppose the Company will maintain a rapid pace of advance for some years to come.

The International Data Corporation has recently declared Palantir to be foremost amongst those providing decision-intelligence platforms. Furthermore, Forrester Research has recognized the company’s proficiency in artificial intelligence and machine learning platforms. Such accolades are suggestive of a future abundance of profitable engagements. Grand View Research predicts that sales of analytics software will increase by twenty-nine percent annually through the year two thousand and thirty, and the International Data Corporation anticipates a growth rate of forty-one percent annually for AI platforms through two thousand and twenty-eight.

Yet, despite the evident prosperity of Palantir’s affairs, its shares are presently valued at an extravagant one hundred and twenty-seven times its sales—an excess that is, frankly, startling. Indeed, it is the most richly valued company within the S&P 500 (^GSPC). The next closely matched firm, Texas Land Pacific, is valued at a mere thirty-one times sales. Even were Palantir’s share price to decline by seventy-five percent, it would still maintain its position as the most expensive stock within the S&P 500.

Palantir has, without dispute, established itself as a leader in the fields of data analytics and AI platforms, and both markets are predicted to expand at a considerable rate in the years ahead. However, the current valuation is such that the potential for reward is, to say the least, overshadowed by the inherent risks. Prudent investors might defer their acquisition until a more reasonable entry point presents itself, and those already holding substantial positions may find it judicious to reduce their holdings.

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Amazon

Amazon has recently disclosed financial results for the second quarter that have exceeded all expectations, surpassing estimates both in overall revenue and in profitability. Revenue has increased by thirteen percent, reaching one hundred and sixty-eight billion dollars—an acceleration from the previous quarter, driven by particularly robust growth in its advertising and cloud computing divisions. Operating margins have expanded by one hundred and fifty basis points, and profits, calculated according to generally accepted accounting principles, have increased by sixty-two percent, to one dollar and fifty-nine cents per share.

The rationale for investment in Amazon is, one might say, remarkably straightforward. The company operates the most extensive online marketplace outside of China, stands as the third-largest adtech company in the world, and Amazon Web Services (AWS) is the leading public cloud provider, measured by infrastructure and platform services revenue. All three of these markets are expected to experience growth exceeding ten percent annually through the year two thousand and thirty.

It is therefore anticipated by those astute observers on Wall Street that Amazon’s earnings will increase by eighteen percent annually over the course of the next three years. This measured forecast lends a degree of fairness to the current valuation of thirty-three times earnings. This is particularly true given Amazon’s consistent success in surpassing consensus earnings estimates – by an average of twenty-three percent over the last four quarters—suggesting that existing forecasts may, perhaps, underestimate the company’s future potential.

Amazon possesses a substantial presence within three expansive and burgeoning marketplaces, and also nurtures nascent opportunities within the realms of robotics and autonomous driving technology. Given the sensible valuation currently assigned to its shares, those investors with a long-term perspective might find comfort in acquiring a moderate number of shares at this juncture.🧐

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2025-08-02 10:15