Palantir Becomes S&P 500’s Most Expensive Stock on Price-to-Sales of 87

Overview

• Palantir shares trade near $155 with a market value around $370 billion on roughly $4.5 billion in revenue, implying a price-to-sales ratio close to 87.
• That multiple makes Palantir the priciest stock in the S&P 500 by sales and places it in territory reached by very few index members historically.
• WisdomTree’s study finds only 231 S&P 500 constituents ever hit 25 times sales and just 148 reached 40, with long-run outperformance rates of 4% and 3% over 20 years, respectively.
• The research also shows that after hitting 25 times sales, only 21% outperformed over the next year with a median relative loss of 36%, and just 9% outperformed over three years.
• The article praises Palantir’s current execution yet flags potential scaling challenges and intensifying enterprise AI competition from giants such as Microsoft.