Palantir (NYSE: PLTR) is among the best performing tech stocks in the past three months as shares of the data mining platform rose almost 109% since last September and are up 40% so far in 2021.
The trader’s aggressive buying strategy supports the rally after Palantir reported stronger than expected September quarter results.
The share price correction occurred this week amid investors’ concerns over lofty valuations. Palantir stock is trading around 446 times to earnings.
However, market analysts believe any dip in Palantir’s share price would create an attractive buying opportunity for the long-term. Its move towards a more modular platform would accelerate demand from new customers.
Government contracts are the biggest catalyst
The stock price rally is backed by its growth strategies and several new government contracts.
The company seeks to become the default system for data across the U.S. government, and it appears that the data-mining company has successfully been getting that place. Its Gotham platform has already been used by the FBI, U.S. military, CIA, and other government agencies when making data-driven decisions.
The company has generated $420.3 million in revenue from government customers in the first nine months of 2020, up 73% from the past year period and represents 55% of its total revenue.
Moreover, the analytics platform has secured multiple government contracts in the past couple of months. In December, the Food and Drug Administration has also signed a new three-year contract with Palantir to track the new drug’s development. Last month, the firm was hired by the U.S. Army to modernize its ground stations.
Enterprise customers are growing
Palantir, which serves its enterprise customers through its Foundry platform, saw almost 30% year over year revenue growth in the first nine months of 2020 to $320 million and accounted for 45% of the overall revenue.
In the past few months, the company expanded Foundry deals with several big companies, including BP (NYSE: BP), PG&E (NYSE: PCG), Rio Tinto (NYSE: RIO), and IBM (NYSE: IBM).