Software company Palantir, PLTR, is a stock I believe is setting up well for a strong move in the coming months. After a monster 2020 where it ran up from $10 to $40, Palantir has been basing throughout 2021, mostly between the $20 and $30 range. Let’s dive in and take a look at the fundamentals and technicals of Palantir Technologies.
Palantir has three main software projects to help organizations integrate data to make more effective decisions: Gotham, Metropolis, and Foundry. Gotham is currently being used by United States Intelligence organizations for counter-terrorism. Metroplis offers financial services for hedge funds and banks. Foundry is used by large corporations like Morgan Stanely and Fiat Chrysler.
Over its’ last two quarters, PLTR has produced triple-digit earnings growth. In addition, it has a consistent history of sales growth and is estimated to have a strong 2022. I also like the fact that management currently owns 10% of its’ shares, indicating they have skin in the game and are bullish on Palantir’s future. What’s even more impressive is that fund ownership has more than doubled in 2021! Clearly, something is going on with Palantir that makes fund managers want to own it.
When looking at the chart, there are a few things I really like. First, the large base built over the course of 2021 is constructive. These type of bases lay the foundation for future gains. I also really like the heavy volume hammer shakeout in May below $20 and the tight action this summer. I opened a position in PLTR today with a stop loss below recent support.
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Full Disclosure: I currently own Palantir (PLTR).
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