Hey, what's up everyone? Welcome back to my world of stocks. We've got an update video for you today on Palanteer stock because I've actually been getting several comments and messages asking for my thoughts on whether Palunteer can actually reach a $1 trillion market cap uh in just the next couple years, which is a projection made by the popular tech analyst from Wedbush, Dan Ies. Plus, I've also been getting asked for my thoughts on their most recent earnings, which we haven't even covered yet on the channel either. So, I'll just be kind of touching on both of those topics today in one video, but with a little more emphasis on that trillion dollar question, especially sharing my thoughts as a large investor in Palanteer stock myself since it is one of my largest holdings in my own portfolio. And of course, Palanteer has skyrocketed in recent years. So, I'll update you too on how I feel about the current valuation and if I would consider to even sell some of my stock too after the huge runup, which I know is something that a lot of investors are actually doing right now, too, because of how much it's climbed and how much uh profits they have, really kind of trying to lock in those big profits. So, all of that and more in today's video. Hit that like button if you appreciate individual stock updates like this once in a while on on certain stocks. But uh yeah, let's just go ahead and jump straight into it, my friends. Starting first here with what Dan Ies had to say about Palanteer recently. So again, Ives really being this very well-known analyst uh who's especially been very well known for being so bullish on tech for many years, similar to myself too, by the way, which is one of the reasons why, you know, me and so many others other investors out there enjoy listening to Dan Ies because he always has, you know, an interesting take on a lot of these tech stocks. Although I would say that I don't take everything that he says as gospel because that really bullish kind of mentality that he has can run a little wild at times with more recently of course uh being this pounder example where he went on CNBC to say that he believes Pounder is on the path to a 1 trillion market cap valuation within just the next two to three years. Now, the reason why he feels this way is that he just really sees the company sitting at the absolute epicenter of the AI revolution, even going as far as to call Palanteer the Messi of AI, who's of course, you know, one of the greatest soccer players of all time, maybe the greatest in some people's eyes, too. But he also sees the total addressable market for AI and AI software just really being worth trillions of dollars uh annually in the future which is a sentiment that is really shared by most other analysts out there too. And he claims that Palunteer is uniquely positioned to capture a significant share of that market because of their artificial intelligence platform what is called AIP that really integrates large language models, machine learning learning and all kinds of other AI technologies into their already advanced software and services that in turn assist both governments and major corporations around the world to solve all of these complex modern problems. even navigating things like supply chain and tariff issues too, which of course have been, you know, especially more challenging this year. Last quarter, in fact, Palanteer's US commercial segments driven by a AIP, uh, nearly doubled their sales year-over-year, and it already accounts for about a third of their total revenue despite the new service barely launching just a couple years ago. It's also driven by their new warp speed platform, which is a manufacturing OS powered by AI that specifically adapts to any company's production needs, even helping them move manufacturing back into the states as they navigate tariffs or to deal with all kinds of supply chain issues, too. For example, it recently helped Anderil achieve a 200x efficiency gain in their ability to anticipate and respond to supply shortages, which is a huge deal. All of this is why Ives no longer sees Palanteer as you know just like a niche software company which is something that you know most bears kind of that's really how they treat Palanteer or how they look at it but rather Ives feels that this is a company that is quickly becoming a foundational pillar for both government and especially modern enterprise which will drive the valuation north of a trillion dollars. But just how feasible is this really specifically to happen within you know just a couple years. Well, at first glance, you might think that for a market cap of almost 400 billion to climb up to a trillion isn't all that crazy to imagine, especially for such a popular stock that has really been on fire recently. But when you do dig a little deeper into the numbers, uh that feed actually does look in my opinion extremely hard to pull off. First of all, this alone would be almost a 170% jump in market cap value. But more importantly, the stock has already skyrocketed by unbelievable amounts as it is, having already doubled in price this year. It's up almost 400% in the past 1 year and nearly 1,600% in the past 5 years alone, too. And as you would expect, that giant runup has also resulted in some extremely expensive valuation metrics where their PE ratio now trades about a,000% higher than the sector. While their more forgiving PEG ratio still trades over 230% more expensive than the sector and even their price to sales ratio trades nearly 3,000% higher, too. In other words, the valuation is already very very extended. It's extended just about as much as you could possibly imagine. I mean, there's really no way that we could even justify the stock nearly tripling on top of this to reach that trillion dollar market cap, which would extend the valuation by that much, too, which again is just already insanely expensive as it is. And so the only way that this would really work here in my opinion is if I would say at the bare minimum the company's financials also grow alongside at the same rate as that stock price as that market cap meaning that their sales and and most importantly their profits uh would really need to I would say at least double or more realistically even triple from here. And again I would say that that's even just kind of the bare minimum. So how likely is that? Well, there's really two ways that I think we could kind of look at this. One is what analysts are projecting and the other is if Palunteer themselves can greatly outperform and enough money pours into the stock on all the AI hype and that really helps lift it up to that market cap despite the rich valuation. On the analyst side of things though, over the next two years, they're only projecting sales and EPS to rise by around 30% each per year, which is nowhere near the high growth that we would likely need in order to achieve this, you know, that market cap so soon. However, it is possible that Palunteer outperforms those uh projections by a giant amount, resulting in the market buying the stock even heavier despite it already being so rich. All of which is possible, don't get me wrong. And as a Palanteer Bull myself, I do actually expect them to outperform to some degree. After all, this is a company that continues to win gigantic contracts every year. And mind you, it's also during a horrendous macro environment of inflation, interest rates, tariffs, and more. Yet, companies continue to pour money into Palanteer services, which is not something that all of their competitors can say, too. In fact, rival C3.ai AI just recently showed preliminary results for for the same quarter and uh their sales actually declined year-over-year with the CEO calling it completely unacceptable. So while other companies in the space are actually struggling, Palanteer instead is accelerating and that shows me that their products are not just you know nice to have services for these other companies but they're actually missionritical for their customers and are in very much high demand. And by the way, their dominance in the government sector isn't slowing down either. In fact, they just secured another massive $10 billion contract renewal with the US Army for their Gotham platform, making it one of the largest defense contracts ever. This shows that even their oldest and most important customers are not only not going anywhere, but rather they're actually doubling down on Palunteer and integrating them even further into what they do. So yes, the stock is expensive right now, but long term there's no telling how high Palanteer can fly in a market that again will easily be worth trillions of dollars in the future. In fact, one of the most shocking aspects of Palanteer's performance, growth, profitability, and potential is what is referred to as the rule of 40. This is a key metric that views revenue in the context of profitability. It's actually used heavily in the software as a service industry and it basically states that if your revenue growth and profit margin together equal more than 40% then the company is performing very well which in the case of Palanteer well it's not only skyrocketed from 46% to a mind-blowing 94% nearly doubling in less than 2 years which is like insane to think about it's like a giant giant number. It means they're doing insanely well but it's also much higher than similar companies too. In fact, not a single enterprise software company generating over a billion in revenue is even higher than 80%. And of the 25 largest market cap companies, only Nvidia ranks higher than Palanteer, who by the way happens to be worth, you know, more than $4 trillion. All this to say that I just think Palanteer is a premium company that is actually earning their premium valuation through their flawless execution. But in answering the big question of whether I think they'll reach a trillion dollars in just a couple years terms of market cap, honestly my answer is I would say no. I just think that that time timeline is a little too aggressive is it would not only require perfect execution from their business but also a healthy enough economy to support it and even a market that is willing to keep paying what is already a very high premium on the stock. So, while I do believe that Dan Ies is on the right track in terms of the direction that Palanteer is headed in, I just think it's going to take a little longer to reach that incredible feat, but I do think it'll h actually happen eventually. And that's why I plan to hold my stock regardless long term because as a long-term minded investor, my time horizon isn't just the next 2 to 3 years, but rather the next 5 to 10 years and even beyond that. And when I look out over the next decade, for example, uh I just think the picture becomes much clearer to me. Pounder's own CEO has even talked about their goal of 10xing the company's revenue long term. And I just think if they can achieve anything close to that, then a trillion dollar market cap isn't just possible. I think with their margins, when you're generating that much in sales and and how much of it is going to trickle down to the bottom line, I think that that type of valuation is going to be highly probable. And I would say the reason why is because the AI market is not going anywhere. It's only going to get larger. And by all accounts, Palanteer, it's only getting larger and stronger themselves as a company. So, I just don't see any reason why they shouldn't get there eventually, too. And I plan to be there every step of the way as a shareholder, ignoring kind of this short-term noise, but focusing on the longer term horizon. But hey, that's just me. Those are my opinions and thoughts and what I'm doing myself. You guys got to make your own decisions, though. So, I'd love to hear from you. What do you think about all of this? What are your thoughts? Do you own Palanteer stock? How do you feel about it? I'd love to hear from you down below. But either way, I hope you enjoyed the video, guys. Let me know if there's any other stocks you want me to give you an update on. And I hope you're all doing well out there. And I will catch you in the next one. All right, take care everybody. Bye-bye.