Will Palantir Technologies Ever Pay A Dividend?

Printed on June thirtieth, 2025 by Bob Ciura

Palantir Applied sciences (PLTR) is likely one of the market’s premier development shares. In simply the previous three years, Palantir inventory has produced returns of greater than 1,200%.

As the corporate’s income development has exploded and it has turn into worthwhile, it’s pure for buyers to surprise if a dividend fee may be on the horizon.

Whether or not an organization pays a dividend relies on many elements. 1000’s of publicly-traded firms pay dividends to shareholders, and a few have maintained lengthy histories of elevating their dividends yearly.

For instance, the Dividend Aristocrats are a choose group of 69 shares within the S&P 500 which have raised their dividends for 25+ years in a row.

You’ll be able to obtain an Excel spreadsheet of all Dividend Aristocrats (with metrics that matter, similar to price-to-earnings ratios and dividend yields) by clicking the hyperlink beneath:

Disclaimer: Certain Dividend is just not affiliated with S&P International in any approach. S&P International owns and maintains The Dividend Aristocrats Index. The data on this article and downloadable spreadsheet relies on Certain Dividend’s personal assessment, abstract, and evaluation of the S&P 500 Dividend Aristocrats ETF (NOBL) and different sources, and is supposed to assist particular person buyers higher perceive this ETF and the index upon which it’s based mostly. Not one of the info on this article or spreadsheet is official knowledge from S&P International. Seek the advice of S&P International for official info.

However, different firms don’t pay a dividend proper now and won’t for a really very long time (or ever).

Buyers within the firm could need to know if Palantir will ever pay a dividend to shareholders. This text will try to reply that query.

Enterprise Overview

Palantir had its preliminary public providing on September 30, 2020. The inventory opened up at $10 earlier than ending the day at $9.50. Nevertheless, the inventory has carried out fairly nicely up to now 5 years, and now trades above $130 per share.

Presently, Palantir has a market capitalization above $300 billion, making it a mega-cap inventory.

Palantir was based in 2003, partially by well-known enterprise capitalist Peter Thiel. Thiel has been the brains, cash or each behind a few of the expertise sectors most profitable endeavors, together with Meta Manufacturers (META) and PayPal (PYPL).

Palantir is likely one of the main suppliers of software program platforms for the intelligence neighborhood. The corporate has 4 essential platforms.

The Palantir Gotham platform can establish patterns hidden in datasets, which vary from indicators intelligence sources to stories with confidential informants. Gotham is utilized by counter-terrorism analysts inside the U.S. Intelligence Neighborhood and U.S. Division of Protection.

Palantir Foundry creates a central working system for a corporation’s knowledge which permits customers to combine and analyze knowledge wanted in a single centrally positioned place.

AIP permits clients to automate nearly all areas of their companies. Its Workflow Builder can assemble AI apps, actions, and brokers.

Lastly, Apollo homes software program deployment instruments. Options embody SaaS, safety, compliance, and extra.

Development Prospects

The corporate’s platforms can be utilized to deal with all kinds of industries, starting from protection to well being care to meals to power. This doesn’t restrict Palantir capacity to draw clients to only a few areas of the economic system.

With a deep pool of potential clients, Palantir is not any area of interest enterprise.

The necessity for companies and organizations to have the ability to safely safe its knowledge in a central location can also be a necessity and Palantir is ready to scale their platform to fulfill their wants.

Palantir has translated these development prospects into outcomes.

On Could fifth, the corporate reported first-quarter monetary outcomes. For the quarter, income of $883.85 million beat analyst expectations by $21.72 million. Adjusted earnings-per-share of $0.13 was in-line with estimates.

U.S. income elevated 55% year-over-year, together with 71% year-over-year development in U.S. business income.

Supply: Investor Presentation

The corporate has additionally been busy profitable new enterprise since going public. Palantir closed on 139 offers within the first quarter price at the least $1 million, 51 of which have been price at the least $5 million.

Palantir can also be starting to seek out extra of a world presence. The corporate can proceed to develop its enterprise by increasing its space of operations.

Aggressive Benefits

Palantir has a number of benefits that units it other than the competitors. First, Palantir’s subtle platform may also help firms optimize their enterprise and discover methods to take away prices from the system. This may also help enhance working efficiency whereas lowering bills.

The corporate’s merchandise are additionally in excessive demand amongst army clients. Whereas considerably controversial amongst sure buyers, the corporate’s platforms have been confirmed to work in these areas which makes them a well-liked selection amongst the intelligence and protection communities.

As soon as belief has been gained, there might be switching prices related to these companies selecting one other vendor.

Palantir additionally has the good thing about rising clients whereas additionally lowering in reliance on only a few clients.

Supply: Investor Presentation

Palantir generated GAAP internet earnings of $214 million together with GAAP earnings-per-share of $0.08, which means the corporate has reached profitability.

The corporate additionally raised steering, now anticipating 2025 income of $3.89 billion to $3.902 billion. Palantir additionally expects free money circulation of $1.6 billion to $1.8 billion.

In the meantime, the corporate has the benefit of serious money reserves. As of the tip of its most up-to-date quarter, Palantir had a complete of $5.43 billion of money and money equivalents, and marketable securities on its stability sheet.

Present belongings complete $6.28 billion, in contrast with present liabilities of $976.4 million, indicating very sturdy liquidity. Only a few younger public firms have such an unlimited sum of liquid belongings out there, with out vital long-term debt.

Such a powerful stability sheet will increase the possibility that the corporate may pay a dividend sooner or later.

Lastly, Palantir continues to be run by the identical management as when the corporate was based. Thiel stays chairman and his handpicked CEO Alex Karp has been in place since 2004.

Will Palantir Ever Pay A Dividend?

Palantir is a uncommon firm that has proven sturdy income and earnings development since its IPO, together with an abundance of money on its stability sheet.

Corporations seeking to pay a dividend must be worthwhile with sturdy stability sheets so as to distribute a dividend.

On the floor, Palantir meets these necessities, which means it may theoretically pay a dividend. Nevertheless, there are different issues for firms nonetheless of their development stage, similar to Palantir.

Primarily, development firms must reinvest money circulation again into their companies, to remain on the expansion observe. Certainly, Palantir continues to speculate the overwhelming majority of its proceeds again into the enterprise.

Working bills rose 22% within the first quarter, year-over-year. This was as a result of firm growing its gross sales and market, analysis and improvement and normal and administrative budgets to a extra affordable stage for a rising and increasing firm.

With excessive bills comes a low stage of earnings, which impacts any doable dividend need Palantir could have. Though the corporate was worthwhile in its first quarter, Palantir is barely anticipated to earn $0.37 per share this yr.

Earnings-per-share are anticipated to develop by 16% subsequent yr to $0.43. This leaves comparatively little room to pay a dividend.

For instance, ff the corporate needed to allocate half of subsequent yr’s earnings-per-share to a dividend, then shareholders would possibly obtain a quarterly dividend of roughly $0.05. This equates to a yield of simply 0.1% on the present worth, which doubtless wouldn’t have a lot enchantment for earnings buyers.

On the identical time, buyers aren’t flocking to Palantir due to its capacity to throw off earnings. The younger firm is already worthwhile and seeing an unimaginable development price. Any use of capital to pay a paltry dividend could be capital that couldn’t be spent elsewhere.

Palantir is significantly better off preserving capital to reinvest in its enterprise. The money on the stability sheet can all the time be used to make an acquisition or assist develop the enterprise in another approach.

Subsequently, we imagine it might be at the least 5 to 10 years earlier than Palantir is able the place initiating a dividend is smart.

Ultimate Ideas

After a sluggish begin, there is no such thing as a doubting Palantir has been a wonderful funding following its IPO. The inventory has rocketed increased in simply the previous few years, producing a lifetime of returns in a comparatively quick time.

The corporate produced GAAP earnings in its first quarter and confirmed that income development stays very excessive. Palantir additionally has a variety of development in entrance of it and has a number of aggressive benefits that ought to propel it increased.

Buyers searching for a development inventory, and don’t thoughts the controversies relating to the corporate’s platforms, may do nicely proudly owning shares of Palantir. What they doubtless gained’t see is a dividend anytime quickly.

For shareholders of Palantir, they’re in all probability extra excited in regards to the complete return potentialities than a small dividend.

Further Studying

See the articles beneath for an evaluation of whether or not different shares that at the moment don’t pay dividends will in the future pay a dividend: