Q2 Earnings Expose a Valuation Gap Between Growth Stories and Cash Flow
Q2 earnings season has split the equity market into two camps that have nothing to do with sector and everything to do with how a company's stock price relates to the cash it actually generates. Palantir grew revenue 93% and posted a 55% net income margin, numbers that would make almost any software company's quarter, and its shares rose a modest 1.87% on the print. Garmin, a wearables and navigation company growing revenue at a comparatively pedestrian 11%, hit a fresh all-time high of $314.28. The market is not paying for growth. It is paying for growth it can underwrite. Key Takeaways Palantir trades near 100x 2026 earnings estimates despite 93% revenue growth, leaving the stock (last at…
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