Palantir is back on every screen this month, up 14.55% in a single week as retail traders pile back into the AI infrastructure trade that briefly wobbled in June. But here is what you should actually be watching.
Palantir Technologies (NASDAQ:PLTR | PLTR Price Prediction) now trades at a trailing P/E of 145 and a forward P/E of 89, with a price-to-sales multiple of 59. That reads like a lottery ticket. The company’s $309.9 billion market cap is being underwritten by $5.22 billion in trailing revenue and CEO Alex Karp’s assertion that “Palantir’s Rule of 40 score has soared to 145%”. Even after the recent bounce, the stock sits 25.43% lower year to date and 17.5% below its June 1 level, and Reddit engagement has cooled to predominantly neutral chatter across investing forums. The story is intact. The math is stretched.
Now look at Salesforce (NYSE:CRM), which the same market has punished to $165.65, off 37.14% year to date and 38.61% over the last twelve months. Contrarian setups like this are rare.
Three reasons Salesforce screens better on valuation
1. Real earnings at a real multiple. Salesforce trades at a trailing P/E of 19 and a forward P/E of 12, backed by $8.64 in trailing EPS and a PEG ratio of 0.779. Fifth consecutive quarterly EPS beat: $3.88 versus a $3.13 estimate, a 24.08% beat. Revenue reached $11.13 billion, up 13.3% year over year. The analyst target of $246.44 implies a gap the market has yet to close.
2. Cash returned to shareholders. Salesforce returned $27.5 billion to shareholders in Q1 alone, anchored by a $25 billion accelerated share repurchase that took the diluted share count from 970 million to 871 million. Free cash flow was $6.556 billion in a single quarter. Palantir, by contrast, pays no dividend and continues to lean on $201.6 million of quarterly stock-based comp that pushes dilution the other direction.
3. The same AI catalyst, at a fraction of the price. Agentforce ARR hit $1.2 billion, up 205% year over year, and combined Agentforce plus Data 360 ARR reached nearly $3.4 billion, up more than 200%. Salesforce processed 28.6 trillion tokens to date and delivered 3.8 billion agentic work units. Marc Benioff called it “an outstanding quarter for Salesforce, record revenue, record deals, and cash flow”. Same agentic AI story Palantir sells. Attached to a 77.68% gross margin, a 21.8% operating margin, and current RPO of $33.6 billion.
Why Wall Street has not caught up yet
Retail is still sifting the wreckage. One Reddit post that gathered 807 upvotes and 308 comments in late June asked, “Salesforce down 30% in 14 straight red days at 10.5x forward earnings… What is anyone actually doing here?” When a mega-cap software leader with 36.73% net income growth and a $63 billion FY30 revenue target gets discussed like a burning house, the mispricing is nearly finished.
The retirement-focused investor does not need another parabolic chart. Put Salesforce on the top of your research list and read the Q1 FY27 filing before the next earnings report reprices it.
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