Japan/Asia Long-Short, LightStream Research

Mio Kato

Japan/Asia Long-Short

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

Equity Capital Markets

Palantir Technologies  / Equity Capital Markets

As expected, Palantir’s listing has not generated the fireworks of better hyped names such as Snowflake. The stock remains around the $10 mark which is lower than some of the private market trades just prior to listing. We remain highly positive on the stock and expect the name to pick up momentum relative to peers as earnings results begin to show through.

As expected, Palantir’s listing has not generated the fireworks of better hyped names such as Snowflake. The stock remains around the $10 mark which is lower than some of the private market trades just prior to listing. We remain highly positive on the stock and expect the name to pick up momentum relative to peers as earnings results begin to show through.

Palantir – Settling in for the Long Term

Palantir has set its expected listing date as the 30th of September and has offered guidance suggesting that 3Q revenue would be $278-280m and full year revenue would be $1.06bn implying 4Q revenue of about $300m. The indicative pricing for the stock has been touted as $10 implying an EV of $18bn on fully diluted shares. We examine the attractiveness of this valuation below.

Palantir has set its expected listing date as the 30th of September and has offered guidance suggesting that 3Q revenue would be $278-280m and full year revenue would be $1.06bn implying 4Q revenue of about $300m. The indicative pricing for the stock has been touted as $10 implying an EV of $18bn on fully diluted shares. We examine the attractiveness of this valuation below.

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Palantir is ready to complete its Direct Public Listing on September 23rd. 
Our valuation analysis suggests an implied market cap of $29.7 billion and a target price of $13.7 per share for Palantir (49% higher than the base price of $9.2 per share). The IPO price range is from $11.1 (low) to $16.6 per share (high). Assuming Direct Public Listing (DPL) market cap of $20 billion and diluted shares of 2.17 billion, this suggests $9.2 per share. Given the solid upside, we have a positive view of this DPL.
There are three key positives with Palantir which we believe are likely to outweigh its negatives, leading many investors to value this company at nearly $30 billion.
<ul>
<li>First, we believe the company's accelerating sales growth since the launch of its Foundry product in 2017 is likely to be valued highly. The company's sales growth is clearly much higher than its peers in 2020. </li>
<li>
<div class="content-highlight">Second, Palantir has picked a great time to complete its public offering with great investors demand high-quality software-related stocks this year.</div>
</li>
</ul>
<ul>
<li>Third, Palantir has been enjoying a noticeable improvement in its operating margins and the company possesses a strong balance sheet. </li>
</ul>

Palantir is ready to complete its Direct Public Listing on September 23rd. 
Our valuation analysis suggests an implied market cap of $29.7 billion and a target price of $13.7 per share for Palantir (49% higher than the base price of $9.2 per share). The IPO price range is from $11.1 (low) to $16.6 per share (high). Assuming Direct Public Listing (DPL) market cap of $20 billion and diluted shares of 2.17 billion, this suggests $9.2 per share. Given the solid upside, we have a positive view of this DPL.
There are three key positives with Palantir which we believe are likely to outweigh its negatives, leading many investors to value this company at nearly $30 billion.

First, we believe the company's accelerating sales growth since the launch of its Foundry product in 2017 is likely to be valued highly. The company's sales growth is clearly much higher than its peers in 2020. 

Second, Palantir has picked a great time to complete its public offering with great investors demand high-quality software-related stocks this year.



Third, Palantir has been enjoying a noticeable improvement in its operating margins and the company possesses a strong balance sheet. 


Palantir is expected to complete its Direct Public Listing (DPL) on 23 September. Although the valuation pricing levels of Palantir's DPL are yet to be announced, it appears that they will be lower than the implied valuation of $20 billion that the company received in the private round funding in 2015. The company's updated prospectus, which includes the latest shares outstanding and average shares price, sets the company's <a href="https://markets.businessinsider.com/news/stocks/palantir-direct-listing-ipo-valuation-sec-filing-stock-price-shares-2020-9-1029578874" target="_blank" rel="noopener">valuation</a> at about $10.5 billion.
With the company's financials now publicly available, there is a strong probability that the DPL will NOT price the company at close to $20 billion. This is a distinctly different case than Snowflake where its IPO valuation is much higher than the private market valuation Snowflake received in early 2020. Overall, there could be more interested investors in Palantir if the DPL valuation is set close to about $15 billion, in our view.
In this insight, we provide the key highlights of the <a href="https://vimeo.com/palantir" target="_blank" rel="noopener">Palantir Investor Day</a> presentation which was held on 9 September. (Source: <a href="https://vimeo.com/palantir" target="_blank" rel="noopener">https://vimeo.com/palantir</a>) It is always good to hear directly from the key members of the senior management team. We provide 13 key highlights from the presentation.

Palantir is expected to complete its Direct Public Listing (DPL) on 23 September. Although the valuation pricing levels of Palantir's DPL are yet to be announced, it appears that they will be lower than the implied valuation of $20 billion that the company received in the private round funding in 2015. The company's updated prospectus, which includes the latest shares outstanding and average shares price, sets the company's valuation at about $10.5 billion.
With the company's financials now publicly available, there is a strong probability that the DPL will NOT price the company at close to $20 billion. This is a distinctly different case than Snowflake where its IPO valuation is much higher than the private market valuation Snowflake received in early 2020. Overall, there could be more interested investors in Palantir if the DPL valuation is set close to about $15 billion, in our view.
In this insight, we provide the key highlights of the Palantir Investor Day presentation which was held on 9 September. (Source: https://vimeo.com/palantir) It is always good to hear directly from the key members of the senior management team. We provide 13 key highlights from the presentation. 

Major Highlights of the Palantir Investors Day Presentation

According to Palantir CEO Alex Karp talking about security and data integration<blockquote>“If you think that we are going to reduce the complexity of these issues to some weird soundbite that makes sense to somebody in marketing hired by a consultancy you should not invest in Palantir.”</blockquote>Alex, don’t you believe in the POWER OF WE???!!!Also<blockquote>“If you think that we will doggedly build the best software in the world years before anyone else and that we will supply the software at the world’s perfect macro timing we want your support because that’s what we’ve done in the past and that’s what we’re going to do in the future.”</blockquote>It’s almost as if Alex Karp believes that long-term thinking and actual innovation are more important than enormous losses, slick marketing and Masayoshi Son sensing the force in you… lunatic.

According to Palantir CEO Alex Karp talking about security and data integration“If you think that we are going to reduce the complexity of these issues to some weird soundbite that makes sense to somebody in marketing hired by a consultancy you should not invest in Palantir.”Alex, don’t you believe in the POWER OF WE???!!!Also“If you think that we will doggedly build the best software in the world years before anyone else and that we will supply the software at the world’s perfect macro timing we want your support because that’s what we’ve done in the past and that’s what we’re going to do in the future.”It’s almost as if Alex Karp believes that long-term thinking and actual innovation are more important than enormous losses, slick marketing and Masayoshi Son sensing the force in you… lunatic.

Palantir – The Anti-WeWork and Updates From Its Presentation

United States

Palantir Technologies Inc. develops software to analyze information. The Company offers solutions support many kinds of data including structured, unstructured, relational, temporal, and geospatial. Palantir Technologies serves customers worldwide.

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Palantir Technologies (PLTR US)

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An examination of Palantir's insider share sales, new order wins and concerns regarding the consulting aspect of its business.

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Palantir DPL Valuation Analysis

Our valuation analysis suggests an implied market cap of $29.7 billion and a target price of $13.7 per share for Palantir (49% higher than the base...

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Major Highlights of the Palantir Investors Day Presentation

We provide the key highlights of the Palantir Investor Day presentation which was held on 9 September. It is always good to hear directly from the...

Douglas Kim

Palantir – The Anti-WeWork and Updates From Its Presentation

According to Palantir CEO Alex Karp talking about security and data integration “If you think that we are going to reduce the complexity of these...

Mio Kato

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