So Palantir just hit a new low and we have to talk about it. Is this the end of Palantir stock? Am I No longer bullish. What's going on? What's the problem? And is there a path for Redemption for this stock? Obviously, as you can see on the screen right now, it's not good. The stock is down 65 percent over the past year now.

It's not really different than many of the other tech stocks that we looked at here, but the problem with Palantir that it has a bigger Hill to climb than the Facebooks, the Googles, the Amazons, and so forth, and so forth. Now if I pull this thing up, you're going to see right away that since the last time we spoke about Palantir which was a few months ago, the share price have plummeted. But what also happened is while the share price probably the share also is now being shorted a lot more aggressively than before, we went from three percent sure interest to seven percent. So we doubled the short interest on the stock.

While the stock is actually dropping, which is not a good sign, it means that more institutional investors more smart money is shortening this talk because for the most part shorting is performed by institutional investors and smart money. It can be done by retail investors, but not very often. So first of all, we have to talk about what's the problem. I Mean, what are the good things about it? What are the bad things about it, and what are the ugly things about it? Let's call it The, Good, the Bad and the Ugly.

Now first of all, the one thing that I can tell you from looking at this here in stock MVP is that revenue is 1.8 billion. TTM Basically, for the past four quarters, volunteer generated 1.8 billion dollars, which is not bad at all. They're a little bit under the guidance which was 30 to 35 percent. They're 28 right now.

but given how bad this year has been going for everybody, I'll take it. There's no problem with the revenues at 2 billion Revenue it's not so bad that's not patented. The problem they're definitely selling. Now the problem with Volunteer starts.

When you like go and look at the cost structure and the cost structure, you are going to find a lot of issues that need fixing and again I'm going to say it right here: I Said it many, many times on Twitter and I'm going to repeat it: The fact that you're a bull on a certain stock does not mean you have to exist in an echo chamber. It does not mean you cannot criticize the stock. It does not mean that you can't point out flaws in the stock. There's no perfect stocks.

There's no perfect spouses except my wife. Of course it is what it is now. I will point out the good and the bad and if it bothers you if you get triggered by it, if you volunteer fan I mean it is what it is I'm not here to run the cult I'm here to show you the good and the bad the new ones. So revenue is 1.8 billion, but look, operating expenses are way too high with 1.6 billion.

Almost all the revenue gets eaten up by operating expenses. Now Ebitda is negative 500 million? Just absolutely abysmal. So far, at this point, we already expected to see better. Ebitda: I Tweeted about this on uh I believe on Wednesday or Thursday and I said hey Palantir, we're saving the world against terrorism.

Great, But how about your ebitda? That's the problem that you haven't solved yet. And that's the major flaw with the stock right now. Because before before this thing gets resolved, before they move to positive ibida, there's not going to be any institutional money and they will not get the trust of the retail investor again. Until this thing goes positive, they will be on the rocks and it is what it is.

That's the key. Ebitda has to go positive for them to actually get some traction As far as the share price goes. I'm not talking about the company, we'll talk about the company in a second, but as you saw on this on this channel, there's a lot of differences between the company and the stock. Sometimes company can be a great company, but the stock might be not so good.

Now with this company, the problem is that they haven't yet turned the profit which is quite concerned and given the fact that it have been at this project since 2017 talking about the business side of things and they've been for 18 years on the government side and still haven't seen positive ebitda we need to get to Gap generally accepted accounting principles: profitability much faster than and Alex Harp would like to and I I think it has to happen very very soon for the stock to actually hold water. Now the good part here and again: I'm not going to bash the stock. I'm also going to point out the good stuff. Look, they're definitely not going to go bankrupt, They're not in any danger, there's no problems with cash flow with liquidity.

This company is absolutely pristine. As far as the balance sheet, the strength the financial strength of the company is is spectacular. This company has 10 times more cash than debt. They got rid of their debt before the recession before interest rates were higher which was a smart move and I have to give credit to the management.

They have a lot of problems with communicating with investors, but that move was very, very smart. Almost know that virtually know that at 2.4 billion dollars in cash, that will allow them a Runway of Ample Ample time to find solutions to the negative ebitda. Their liabilities are very, very low compared to the assets. Three times more assets and liabilities, 10 times more cash than that.

Very very healthy balance sheet. But again, the Ebitda is that killer seal for this company. And this is the biggest problem Where right now institutional investors are looking at this and saying not yet, not yet. Even though the price is starting to get attractive, it's 6.3 dollars.

They're still waiting for it to come to that positive ebitda site. And I can show you exactly how it looks like here in stock. MVP Because we can go and look at institutional ownership now. the stock dropped yesterday by eight percent.

Eight percent. Now the entire Market was in the toilet yesterday. But I mean this volatility is because it doesn't have high participation of institutional investors. Once the stock is heavily invested by institution investors, it doesn't become that volatile because the volatility on the institutional side is much much more relaxed.

The problem here is you can see is that a 35 institutional ownership 35 is just not enough. It's too low for a stock that has to kind of trying to get into the top 50 top 60 companies top 100 companies, they have to get to 60 institutional shareholding. That's kind of The Benchmark The Golden Rule They're about half that right now. With such high 53 retail investors ownership.

it's a very volatile stock because Rita By definition they tend to be very volatile and not as stable as institutional investors institutional have to go to 60. It's going to take a while I showed you before until Ebitda goes positive, it ain't going to happen now. You can see that the institutionals here are pretty much some of the biggest in the business. Vanguard and BlackRock Vanguard owns 7.7 percent of Palantir.

Blockwork owns five percent of Palantir. That's all. Nice and dandy, but we need more institutional investors. You can see right here that this is kind of goes against the fat a little bit that institutional ownership in the company is actually going up.

We went up. This was just two years ago at 176 million shares. we're now up to 663 million shares. So institutional shareholding is going up.

but the pace as you can see is slowing down. In the beginning the pace was very rapid, but since last year since September last year so a year ago exactly it pretty much went flat, just slightly going up Because at this point the institutional investors are saying to the management by not buying more we want to see positive ebitda we want to see Gap Profitability Not enough to tell us stories about terrorism. we want to see the numbers. Now the other part here is definitely The Insider Selling.

Look, there's a lot of Insider selling in this company, but it's basically because of the very Hefty compensation packages to Carp and to a charm sound car. But overall, there's not been a lot of movement over the past year. I can show you if I go all the way to the start and I Can show you that despite all these sales, a lot of them are conversions like Sham Shankar. As you can see right here, you can see that uh, his security is 2.1 million at class A And let's look at class B Class B 608 000.

So 2.1 million and 680 000 Class A Class B If we go to page two, I Believe, let's look at page one or two. Where is this? I'm having trouble seeing this right here. Hold on. Where do we have? Sham Song or Okay found them? So Sham Shankar Right here he went down by two hundred thousand from 2.1 million to 1.9 million in class A common stock.

So allegedly he sold 200 000 stocks. but his class B shareholding went up by two hundred thousand. So it was just conversions from class A to class B Again, a lot of fun. The same thing with Alex Carp.

there's you would go to the last page and you would see a lot of sales. but Alice Carp Alice carpal scarp. All these are sales. but if you're going overall you check his shareholding for the year.

pretty much is unchanged. Class A and Class B are pretty much the same. Almost 50 million dollars of Class B stock and almost six and a half million of class A stock. Nothing has really changed on that front, so this is mainly fud.

but the part that is not fun and should be taken seriously is the fact that these managers gotta have the compensation package they have to deliver. You cannot pay so much for Quality Management which they're doing and not expect and demand positively with the year sixth into this whole project that is the business side. you know in by 2017 if this was just a government contractor nobody would have cared about this company. This all interest in Palantir started when in 2017 they started Foundry with Airbus and that project led to the whole startup that is Palantir business the B2B side of it.

but that business year six right now it has to start showing gap of stability. it just it has to. Now as far as the share price right here I can run it quick to see if but I can tell right now that this company will require a lot a lot of good assumptions here for this thing to actually make sense. So let's say that currently they're at negative 500 million ebitda.

Let's say they break even next year. Let's just be generous here. let's say that they do a 300 million in year 2024. then let's do 600 in 2025 900 just for the sake of the example.

Just to show you I don't think they'll do these numbers and and then that's our ebitda right? So we have the ebitda and let's do depreciation amortization 10 Capex growth Let's do one and a half percent populate and then let's do 10 long term and discount rate. So based on this which is kind of a very I would say not such a aggressive but not so conservative a realistic expectation if the company actually manages to pull out a one billion dollar ebitda by 2027. 1.2 billion dollars ebida by 2027. Which means about five six billion dollars in earnings.

Let's say even seven billion dollars by 2027. From two to seven within the next five years. they're pretty much undervalued by 30 right now. But then again, it all depends on the interest rates.

We can actually show you that if interest rates will will go up, this valuation will be much more painful for volunteer. The problem with volunteer is that things have changed. At the bottom line, what happened is that the market isn't really tolerate. it doesn't really tolerate any more growth and stories and revenue.

The multiples of shrunk you saw what happened to every big Tech stock. The only thing this Market is looking for is results. On the financial side. We want to see them beat the earnings.

We want to see them provide positive ebitda and positive Gap gap of stability. Until that happens, this is going to be a six, seven dollar stock. maybe eight, but that threshold will not be broken until Piloted delivers actual results. On the financial side: I'm still bullish on the stock I'm not selling, but I'm also not adding to my position because like the other institutional investors, I'm sitting on the sideline waiting to see if this management can deliver on the actually giving us the gap of stability.

So my position is bullish but waiting on the sideline waiting to see more from this management before. I Add to my position.