On Thursday, Palantir Technologies Inc. (NYSE:PLTR) shares surged more than 4.5% after announcing a strategic partnership with connected vehicles data company Wejo. The two companies are combining their technologies to develop an automotive data ecosystem.
They will use Palantir’s Foundry platform and Wejo’s extensive database of information collected from a network of 11 million vehicles.
Revealing the partnership, Wejo said that it has already analyzed more than 10 trillion data points and 48 billion journeys from live vehicles so far. The ecosystem being developed will work with smart city infrastructure planners and parts suppliers to improve component quality.
Palantir’s automotive ecosystem could be crucial for the rapidly growing autonomous vehicles market. Therefore, its partnership with Wejo offers an exciting future ahead to investors.
Should you bet on Palantir’s growth despite its steep valuation?
From a valuation perspective, Palantir shares seem steeply priced at a forward P/E ratio of 128.95, making the stock unattractive to value investors.
However, with analysts expecting its earnings per share to grow at an average annual rate of about 49.39% over the next five years, growth investors could find the stock compelling in the long term.
Therefore, although Palantir seems expensively valued based on its forward P/E, investors willing to overlook short-term turbulence could profit significantly in the long term.
Is Palantir finding trendline resistance after the recent rally?
Technically, Palantir shares seem to have recently rallied towards the trendline resistance in the intraday chart. Moreover, the stock price has also spiked closer to the overbought conditions of the 14-day RSI.
Therefore, the PLTR stock seems poised for an imminent pullback before continuing with the current rally.
