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Lots of surveillance. Pandemic tracing. Predictive policing. Rebellion detection. Drug test. Political lobbying. AI deployment. NHS reorganization. Employee snooping. Vaccine rollout. Spack investment. See Tolkien. It’s difficult to avoid a Palantir with Palantir. Simply listing that activity can make a person sound like a crank or a co-founder.
That’s why a recent note from Trivariate Research has caught our attention. Founded by former hedge fund manager and Morgan Stanley chief US equity strategist Adam Parker, the boutique rarely does a single stake. When that is done, it runs the data.
Parker isn’t what Palantier does, but what interests you most is how much it costs. According to his calculations, Palantir is one of the most expensive US large stocks to date.
Palantir’s $314 billion market capitalization will be the top 30 components of the S&P 500 between Coca-Cola and Bank of America. Its PE ratio looks nuts well – 565 times followed, 228 times forward – but they are nothing compared to multiples of sale.
According to the trivariate screen that established US non-financial inventory in 2000, only six people have traded at a higher EV-to-prognostic sales ratio than today.
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Of the 15 strains above, five are Moonshot Biotechnology, and one is MicroStrategy, which lies in its own strange category. Of those peaking before 2024, many were not long-term investments.
Comverse Technology had died by 2013, and its CEO was placed in prison in 2017, running for over a decade. Bluebird Bio went private this week with less than a fifth of its 2019 rating. Modanya has fallen 94% since the high pandemic in the central region. Fuelcell Energy, like plug power, has dropped by 99% over four years. It took Cheniere Energy, an LNG exporter, to halve its level in 2015, five years to regain its level.
The broader point is that enterprise values for 70x forecast sales are by no means normal. In most years, there are zero US stocks established with just 30 times sales.
Toppy forward ratings actually occurred during the dot-com boom and the free money pandemic era. This has resulted in an outlier last year. Soundhound AI and Astera Lab both joined a 30x sales club in December (lost 60% by early April).
©Trivariate Research
Although some of these examples are extreme outliers, Trivariate’s on-screen inventory, which reached 30x forecast sales, fell an average of 22.5% performance for the S&P 500 next year, closing with just 18x sales.
The derailment is partly due to heavy compression, and partly due to downgrade predictions. Companies enter the bubble zone after an average increase in annual revenue by 45%. Analysts are hoping they will repeat the trick and are disappointed. The average annual sales growth rate slows to just 28%.
©Trivariate Research
Where does it leave Palantia?
To find the equivalent, you need to go back to 2000 when network widgets and software makers were routinely traded with three digit sales double.
Using subsequent revenue rather than forecasts, Parker and the team list the most expensive stocks in the Dotcom bubble as Ariba, Brocade, Juniper, Verisign and Tibco software. Things didn’t work for them:
©Trivariate Research
Palantir is similar to a one-stock bubble. It is expected to be more than three times more expensive than the next most expensive company (except strategy) and to bring about unprecedented sales growth for a company of that size, but better than something much cheaper than what is available elsewhere.
©Trivariate Research
Parker and the team note that the S&P 500 rebalance at the end of June will raise the index weights of Palantir across a large threshold, which forces active managers to apply sanity checks.
Palantir may be fundamentally great, we don’t know. However, we know that none of the companies have grown fast enough to justify this assessment, and that many are expected to grow faster in response to consensus expectations. It’s hard to imagine this looking appealing to a cap portfolio manager who intends to do a new job on this before hitting the index.
It’s one take. Other analyses are available:
Exclusive: Alex Jones responds to Palantia Hysteria and laid out what’s really going on pic.twitter.com/dhuvpwh58k
-Alex Jones (@RealAlexjones) June 2, 2025
Read more:
– Everything is nuts. When does the crash occur?
