We rarely get much of a chance to talk about it, but momentum in the market works like physics. Any stock in motion will continue moving along that trajectory until some outside force gets in its way. Palantir Technologies (PLTR) is a name that has shot into the scoring zone, writes Hilary Kramer, editor of GameChangers.
Most of our stocks reported good enough operational performance in the last few weeks to start moving toward the upside...some faster than others, but generally the right direction. Positions we were holding before they reported their quarterly numbers have rallied an average of 14.3% since. That’s pretty good. When you consider that the S&P 500 is down a fraction since the start of earnings season, it’s exceptional.
What we’re left with is a generally warm vibe. A lot of people on Wall Street underestimated these companies. Estimates were too low, which means that now price targets need to rise in order to make the models match reality.
After all, while everyone is entitled to an opinion on where the numbers are going, the magic of earnings season means that once the quarterly report comes out, there’s no more debate on how the numbers have stacked up. And once you accumulate enough data points pointing in one direction (UP), it gets really hard to argue that they “should be” going the other way.
Most of our data points have pointed up this season, forcing stubborn investors and analysts to concede that they were wrong and that these companies are worth buying at this price. The machine-learning software and data-mining specialist PLTR in particular has been a revelation.
Palantir Technologies (PLTR)
That stock had been left for dead before earnings proved that last quarter’s promises were more than a mirage. On the eve of its quarterly report, it had relapsed to $7.74. Here we are now, back above $12 and even $13.50 where the action gets especially intense.
There’s absolutely nothing stopping PLTR from continuing to do well. I’d be inclined to see how far it can reach back toward what’s now the 2022 ceiling. Remember, we weren’t in the grip of zero-rate Fed mania then. That was close to the depth of bear market misery.
And even then, PLTR managed to trade close to $15 before starting its long dreadful slide. That’s the kind of scenario I want to reach toward as the bull recovers. And it means that PLTR is a gift at this price.
Recommended Action: Buy PLTR.
Subscribe to GameChangers here...