Palantir Technologies’ stock price has surged 313% in 2024, but its valuation may be overvalued. The company’s price-to-sales ratio of 63 and trailing earnings multiple of 345 are causing concerns among analysts. However, Wall Street expects a 46% drop in the stock’s value over the next year.
In contrast, Arm Holdings and Applied Materials are predicted to surpass Palantir’s valuation in the next year. Arm Holdings has a strong market share in the global chip market, with revenue growth expected to jump 25% in the next fiscal year. The company’s earnings guidance is also stronger than Palantir’s estimated bottom-line growth.
Applied Materials, another semiconductor equipment provider, is benefiting from the rising demand for AI-related chipmaking equipment. The company’s sales of DRAM and HBM memory capacity are expected to increase significantly in the next year, driving revenue growth and profit margins. With a 12-month median price target of $225, Applied Materials is well-positioned to overtake Palantir’s valuation.
As investors consider Arm Holdings and Applied Materials, it’s worth noting that The Motley Fool Stock Advisor analyst team has identified other stocks with strong growth potential. These stocks could provide similar returns to Nvidia, which was recommended by Stock Advisor in 2005 and resulted in a 88% return on investment.
Source: https://finance.yahoo.com/news/prediction-2-stocks-worth-more-111700355.html