The Long Term Investor

As to PLTR....down today. Not really fundamental based....more so on news speculation about the CEO selling 10MILLION shares and a pentagon rumor that even if true may or may not impact the stock.

Palantir plunges after CEO Karp changes share sales plan, Pentagon budget cut report

https://www.cnbc.com/2025/02/19/palantir-shares-pentagon-cuts-trump.html

(BOLD is my opinion OR what I consider important content)

"Key Points

• The share price of Palantir fell as much as 12%.
• The drop followed a report by the Washington Post that Defense Secretary Pete Hegseth has told top Pentagon brass to prepare to cut the U.S. defense budget by 8% each year for the next five years.
• Palantir is best known for its contracting work providing software and technology services for defense agencies.

The share price of Palantir fell as much as 12.5% Wednesday after news that CEO Alex Karp had adopted a new stock trading plan, and a report that the Pentagon has been ordered to prepare to cut the U.S. defense budget by 8% each year for the next five years.

Palantir is best known for its contracting work providing software and technology services for defense agencies.

On Tuesday night, Palantir in a regulatory filing disclosed that Karp’s new plan will allow him to sell nearly 10 million shares of company stock in the next six months.

The Washington Post on Wednesday said Defense Secretary Pete Hegseth has ordered senior Pentagon leaders and other military brass to develop plans to slash the defense budget over the next half decade. The budget for the current fiscal year is around $850 billion.

The Post reported that Hegseth ordered the proposed cuts to be drawn up by Monday.

Palantir closed trading Wednesday at $112.06 per share, a drop of 10%. Shares were down more than 1.5% in after-hours trading.

The company, whose market capitalization tops $255 billion, in early February reported $828 million in revenue in the fourth quarter of 2024, with adjusted earnings of 14 cents per share.

Before Wednesday’s abrupt drop, Palantir had been one of the top-performing stocks in the U.S. for the last two years, including a share price rise of nearly 50% in the year to date.

Palantir trades at a price-to-earnings ratio of nearly 600-to-1.

The Trump administration has been engaged in a wide-ranging effort to slash government spending and the number of federal government workers since President Donald Trump was inaugurated for a second nonconsecutive term on Jan. 20.

Trump appointed Tesla CEO Elon Musk to oversee that effort, dubbed the “Department of Government Efficiency.”

Musk and Trump have come under fire for their methods in achieving DOGE’s goal, with some steps being challenged successfully in federal court.

On Tuesday, Karp, who co-founded the company with Peter Thiel, defended Musk during an appearance on CNBC’s “Squawk Box.”

“What the progressive left should be doing is saying, ‘OK, Elon, you’re clearly the most qualified person in the world to do something like this. We want a dialog with you about what you’re doing, how you’re doing,’” Karp said.

“I don’t believe that’s happened,” he added."

MY COMMENT

Typical media overreaction and of course than an impact on the stock as the AI Trading Platforms ramp up selling and trading the news. A founding CEO selling shares is nothing new....although I do believe it impacts the stock price to have that many shares sold over six months.

As to the rest regarding the pentagon....simply speculation.

 

My WMT reports tomorrow before the bell.

Walmart expected to win over more high-income consumers as it reports fourth quarter results

https://finance.yahoo.com/news/walm...reports-fourth-quarter-results-163516678.html

 

Well WMt is a perfect fit for my portfolio.....as a junior position.....which means less than 1% of the total portfolio. It is just like all my other stocks. it puts up a very good earnings BEAT.....and is punished on guidance. I heard a "TV TALKER"....retail expert....today saying this is BS since WMT always puts up conservative guidance. Whatever.

Walmart shares drop as retailer says profit growth will slow

https://www.cnbc.com/2025/02/20/walmart-wmt-q4-2025-earnings.html

(BOLD is my opinion OR what I consider important content)

"Key Points

• Walmart topped earnings and revenue estimates for its fiscal fourth quarter, but said its profit growth will slow in the current fiscal year.
• Still, the retailer’s CFO, John David Rainey, said the company wouldn’t be “immune” from looming tariffs on Mexico and Canada.
• Walmart saw strong gains in its e-commerce business and membership programs.

Walmart shares fell more than 5% in premarket trading Thursday, as the big-box retailer said profit growth will slow this fiscal year even as sales continue to climb.

Walmart said holiday-quarter revenue rose about 4% and e-commerce sales shot up 20% in the U.S., as growth in store pickup and home deliveries and gains with upper-income shoppers boosted results. But its outlook disappointed Wall Street.

In the fiscal year ahead, the discounter said it expects net sales to grow 3% to 4% and adjusted operating income to increase between 3.5% to 5.5% on a constant currency basis. The company said that includes a 150 basis point, or 1.5 percentage point, headwind from acquiring smart TV company Vizio and following a leap year in 2024. For the just completed fiscal year, Walmart posted adjusted operating income growth of 9.6% on a constant currency basis.

The company also said it expects full-year adjusted earnings of $2.50 to $2.60 per share, which includes a 5 cent per share headwind from currency. That fell short of the $2.76 per share Wall Street had expected.

In an interview with CNBC, Chief Financial Officer John David Rainey described consumer spending patterns as “steady” and said “there’s not any sharp changes that we’ve seen.”

Yet he acknowledged “there’s far from certainty in the geopolitical landscape.”

About two-thirds of what Walmart sells is made, grown or assembled in the U.S. Yet if tariffs on imports from Mexico and Canada take effect, he said Walmart is “not going to be completely immune.”

“We’ve lived in a tariff environment for the last seven or eight years, and we’ll do what we know how to do,” he said. “We’ll work with suppliers. We’ll lean into our private brand. We’ll shift supply where necessary to try to take advantage of lower costs that we can then pass on to consumers.”

Since Walmart is not sure if the tariffs will take effect next month, the company did not factor them into its guidance, Rainey said.

Here is what the big-box retailer reported for the fiscal fourth quarter compared with Wall Street’s estimates, according to a survey of analysts by LSEG:

• Earnings per share: 66 cents adjusted vs 64 cents expected
• Revenue: $180.55 billion vs. $180.01 billion expected

In the three-month period that ended Jan. 31, Walmart’s net income fell to $5.25 billion, or 65 cents per share, compared with $5.49 billion or 68 cents per share in the year-ago period. Revenue rose from $173.39 billion in the year-ago quarter. The company’s adjusted earnings per share figure excluded one-time items, including opioid-related legal costs and gains and losses on equity and other investments.

Comparable sales, an industry metric also known as same-store sales, increased 4.6% for Walmart’s U.S. business and 6.8% for Sam’s Club, excluding fuel.

Walmart’s e-commerce sales in the U.S. soared 20% compared with the year-ago period. That marked the 11th straight quarter of double-digit gains. Global e-commerce sales rose 16%.

In the Walmart U.S. segment, customers’ store visits and purchases climbed, as transactions rose 2.8% and average ticket increased 1.8% year over year.

As Walmart is the top grocer in the U.S., investors often view it as a barometer of consumer health. Investors have tried to parse whether softer U.S. retail sales in January were a blip or warning sign. Wall Street also is trying to understand the potential impact of policy decisions, such as tariffs, on consumer spending.

Restaurant chains, including Restaurant Brands’ Burger King and Popeyes, said sales improved in the fourth quarter, but they had weak trends in January.

Yet those restaurants and some retail experts have blamed short-term factors for the drop, including winter storms, consumers taking a break after splurging over the holidays and contending with damage and disruption from the Los Angeles wildfires.

Rainey echoed those sentiments, saying cold weather and the wildfires hurt Walmart’s sales. He said that’s a temporary factor, however, and doesn’t indicate a change in consumer spending patterns.

Walmart’s e-commerce growth and newer initiatives worked in its favor in the fourth quarter. Its advertising business and third-party marketplace are small compared with Amazon’s, but have posted gains and driven higher margins than Walmart’s retail business.

Rainey pointed to double-digit gains in the fourth quarter in global advertising, membership income and Walmart’s fulfillment services segment, which packs and ships orders to third-party sellers.

“These are all higher margin, faster-growing parts of our business where the math is just suggesting that our margins are going up over time,” he said. “And frankly, I don’t see any end to this.”

Walmart also hiked its dividend by 13% to 94 cents per share, the largest increase in more than a decade.

As of Wednesday’s close, shares of Walmart are up about 83% over the past year. The stock closed on Wednesday at $104.00, up about 15% so far this year and outpacing the approximately 4% gains of the S&P 500 during the same period."

MY COMMENT

The largest dividend increase in over ten years pretty much says it all. This company is BOOMING. Too bad they dont play all the little games with guidance that some of the others do.

As to tariffs....so what....as they said above they have been dealing with tariffs for at least seven years now. And if any of us have a memory more than six minutes.....a rare thing these days......they did just fine during the last four years we had the same government that we do now.

A great company.....with a very broad customer base and multiple sources of income. I look forward to hopefully owning this stock for a long time and making them a full position.....someday.

 

Basically......I dont know why I even look forward to earnings anymore. They are just about always good for my companies.....but....it never maters anymore.

 

At least we still see the longer term impact of good earnings.

Strong Earnings Should Keep Stocks on a Winning Path
As go earnings, so go stocks

https://investorplace.com/hypergrow...arnings-should-keep-stocks-on-a-winning-path/

"Key Takeaways:

• As go earnings, so go stocks. And right now, earnings are really good.
• About 80% of companies in the S&P 500 have reported earnings so far this season. More than 75% have beaten Wall Street’s profit estimates, meaning they made more money last quarter than analysts expected.
• Trends are expected to stay strong for the foreseeable future. Next quarter, earnings are projected to rise about 8%, then another 9% in Q2. They are expected to rise almost 15% in the third quarter and about 13% in the fourth.
• With more fantastic earnings growth on the horizon, stocks are likely on the launching pad to fresh highs.

From ‘buy low, sell high’ to ‘bulls make money, bears make money, pigs get slaughtered,’ Wall Street’s favorite maxims are as famous as some of the traders who live by them. You might be familiar with mine: As go earnings, so go stocks.

And right now, earnings are really good.

The more money a business makes, the more valuable it becomes; and of course, the reverse is also true.

On Wall Street, this cash flow is measured in quarterly earnings, accounting for the business’ revenues minus all expenses and taxes. Therefore, it makes sense that as earnings go up, a company’s stock price – its real-time value – does, too.

But this is more than theory. It is what tends to happen on Wall Street.

Just look at the chart below. It reflects the S&P 500’s price (white line) with its earnings (blue line) from the early 1990s to today. As you can see, the two lines are nearly in lockstep with each other.


When earnings are rising – as they did from the early 1990s to 2000, 2003 to 2007, 2009 to 2014, 2016 to 2019, 2021 to 2022, and 2023 to today – stocks rise, too. When they’re falling – as they did from 2000 to 2002, 2007 to 2009, 2014 to 2016, and in 2020 and ‘22 – stocks do the same.

As go earnings, so go stocks. That’s why we say, follow the earnings.

Right now, strong earnings are forecasting great things ahead for stocks.

Earnings Recap

Over the past few weeks, companies across America have been reporting fourth-quarter earnings results. So far, those numbers have been very strong.

About 80% of companies in the S&P 500 have reported earnings so far this season. More than 75% have beaten Wall Street’s profit estimates, meaning they made more money last quarter than analysts expected.

Meanwhile, the blended earnings growth rate is nearly 17%, which marks the index’s highest profit growth rate since 2021.

This has been an absolutely fantastic earnings season.

More importantly, trends are expected to stay strong for the foreseeable future.

That is, next quarter, earnings are projected to rise about 8%, then another 9% in Q2. They are expected to rise almost 15% in the third quarter and about 13% in the fourth.


In other words, earnings should keep rising for the rest of the year.

That means that if you’re hoping to lock in big market profits this year, now is the time to buy – before stocks continue powering higher.

The Final Word

Street analysts expect earnings to keep rising throughout the remainder of 2025.

And as go earnings, so go stocks.

With more fantastic earnings growth on the horizon, stocks are likely on the launching pad to fresh highs. And for those investors who get in early, before those gains continue, the profits could stack up fast."

MY COMMENT

HERE....is the basic truth. Something you dont hear very often day to day....even though it is the most OBVIOUS TRUTH in the markets:

"The more money a business makes, the more valuable it becomes; and of course, the reverse is also true."

I like the above little article because it is BASIC.......BIG PICTURE.....investing truth. this "stuff" represents the basic reason for long term investing.

 

The market is sliding today....based on NOTHING. Yes....it is the SEINFELD market......a market based on NOTHING. In other words.....AI TRADING PLATFORMS......trading the negative headlines today.

Over the longer term we see the positive impact of earnings and fundamentals especially in the big growth side of the markets. Short term....we see the trading driven side of the markets....that reflects NOTHING more than....HUGE MARKET DRIVING MONEY....pushing the markets around for short term trading profits......... taking advantage of the day to day news and headlines.

 

I see this as simply a....FALSE MEDIA NARRATIVE. This is a perfect example of a company being driven down....short term....by a very speculative story and a FALSE narrative being spread by the media.

Palantir stock drops 10% after report Trump administration is eyeing large defense budget cuts

https://finance.yahoo.com/news/pala...eing-large-defense-budget-cuts-145619883.html

(BOLD is my opinion OR what I consider important content)

"Palantir stock (PLTR) fell 10% for a second day on Thursday, adding to Wednesday's 10% that followed a Washington Post report which said the Trump administration has told the Pentagon to plan for massive budget cuts over the next five years, casting doubt on a major source of the tech firm's revenue.

The Post reported that Defense Secretary Pete Hegseth sent a memo to senior leaders within the Pentagon and US military to slice 8% from the defense budget every year over the next five years, potentially equating to tens of billions of dollars in cuts.

"Our budget will resource the fighting force we need, cease unnecessary defense spending, reject excessive bureaucracy, and drive actionable reform including progress on the audit," Hegseth wrote in a memo seen by the Post.

Some 17 categories would reportedly be exempt from the cuts, including US border operations and munitions acquisitions, the Post wrote.

Palantir did not immediately respond to Yahoo Finance's request for comment.

Palantir makes AI software used for surveillance by the US government. More than half of the company's revenue in its most recent quarterly earnings report came from global government contracts, driven by increasing spending from the US Department of Defense.

Despite the selloff, Wedbush analyst and Palantir bull Dan Ives was quick to defend the tech firm's ability to weather the potential budget cuts: "n our view Palantir's unique software approach will enable the company to gain MORE...budget dollars at the Pentagon....not less despite these initial knee jerk reactions from the Street," he wrote in a note to investors Thursday morning.

"Palantir is so well positioned for this new disciplined spending environment at the Pentagon and this will ultimately be a positive growth catalyst as the various programs are scrutinized and as Karp & Co. get a bigger seat at the table in the Beltway," he added.

The Financial Times reported in December that Palantir is also in talks with competitors, including Anduril, to form a consortium that will bid for US government contracts.

The stock has been on a tear in 2025, rising more than 48% year through Wednesday, making it the second-best-performing stock in the S&P 500.

Over the past year, the stock has gained more than 300%."

MY COMMENT

I am NOT concerned in the slightest. I see this as a good buying opportunity.....if I had any money available. I have plenty of gains in this stock to not have any concern.

This is a totally FALSE NARRATIVE and simply a made up story line. the basic quote from the DD is probably correct.....but who even knows that.

Assuming this story is true and it actually happens....I am in the camp that it means even MORE money for PLTR. AI is the one area that will see massive growth at the DD and in all of government. It is the area that will give government the EFFICIENCY and ABILITY to do more while spending less money.

ANYONE....that has a brain......and has been paying attention over the past few weeks......knows that the cuts in government that are happening are in areas of WASTE, STUPIDITY, SOCIAL SCIENCE BS, ILLEGAL ALIENS, etc, etc, etc.

Any future cuts are not just going to be broad based....they will be very FOCUSED. AND.....focused cuts are NOT going to hurt PLTR.

 

Just a comment......I use the term....."ILLEGAL ALIENS"....above as a legal term of art. That reflects my schooling in LAW earlier in my life.

I still remember very clearly the first week or two in the Civil Procedure class in Law School. One of the first things learned was that the......US CODE......defines people in categories.....in terms of how the law works and impacts various rights. Legal terms of art....have very specific meaning and are necessary for clarity.

We have two basic legally defined categories of people in the USA......."CITIZENS" and "ALIENS". Federal law breaks down the "ALIEN" category into two classes......."legal aliens" and "illegal aliens".

I really dont care what term the "media" chooses to use or likes or dislikes.....I prefer to use the very specific legal term of art when speaking. This is NOT a political comment or opinion.....it is basic law.....and...is necessary to allow for clarity and uniformity in the courts and the interpretation of basic personal rights under the law.

 

As usual.....YES....more good news for the FED and some future FED cuts.
US weekly jobless claims rise more than expected
https://finance.yahoo.com/news/us-weekly-jobless-claims-rise-134056765.html

"Initial claims for state unemployment benefits rose 5,000 to a seasonally adjusted 219,000 for the week ended February 15, the Labor Department said on Thursday. Economists polled by Reuters had forecast 215,000 claims for the latest week."

 

The above is about it for the markets today.....a BIG TEMPEST in a teapot. Great earnings ignored and nit-picked and a simple broad story-line about defense cuts.....blown out of context.....by MADE UP media fear-mongering. In other words......NOTHING NEW.

Just another day in the short term market neighborhood. The land of media FANTASY. AI TRADERS love it.....long term investors ignore and hate it.

 

What we are seeing today makes me see that is really does not matter what NVDA reports next week. The MEDIA GODS....are just never going to be happy with it. AND....as a result for a day or two the AI PROGRAM TRADERS computers will be burning up with the micro second trades taking advantage the....often simply STUPID..... opinion based news that is the norm today.

AND of course....it goes beyond what I stated above. The AI TRADERS will end up creating and controling the very conditions they are trading. They have such massive amounts of money and trading power....for a few days they have total ability to create the very market they are trading.

It is simply.....LEGAL....market manipulation since they ALL act and trade in concert based on identical or at least very similar algorithms.

 

Moving on with life....no reason to waste time on the markets today.

COURAGE....ENDURE.....PATIENCE.....ENJOY.....CELEBRATE.....rinse and repeat.

 

I am encouraged to see a CFO come out and defend guidance.....from the obnoxious media that reads speculative BS into everything. It is nice to see a company that has the guts to CALL BS on the media take on their guidance.

Walmart CFO defends conservative guidance as Wall Street stays bullish on the stock despite plunge

https://finance.yahoo.com/news/walm...sh-on-the-stock-despite-plunge-172121500.html

(BOLD is my opinion OR what I consider important content)

"Walmart's (WMT) CFO is looking to assuage fear among investors that 2025 won't be as strong as in recent years.

"They're conflating our guidance with ... maybe suggesting that we're feeling like things aren't as good, or the economy is softer," John David Rainey told Yahoo Finance over the phone. "Let me be very clear: That's not the case. We feel really good about how we're doing."

Shares of the retail giant sank more than 6% in trading on Thursday after it put forth conservative 2026 fiscal year guidance, which it has done for the past two years. It projects net sales to increase between 3% and 4%, in line with a target of 4% annual sales growth it laid out years ago.

However, the guidance missed Wall Street estimates of up to 4.2%. It's also below its 2025 pace, where sales grew 5.6% to $684.2 billion.

Rainey said the company performed well in January, but with uncertainty regarding tariffs and the macro environment, the team has taken a "kind of prudent approach at this point."

The retailer also won't benefit from the same inflationary boost to its top line as it did the past several years, per Rainey. Overall, "there's nothing to read in between the lines here about some concern on the economy or our business," he added.

Shares of Costco (COST), Dollar General (DG), Dollar Tree (DLTR), and Target (TGT) also fell on the news Thursday.

Joe Feldman of Telsey Advisory Group told Yahoo Finance that "expectations were running high into Walmart's earnings report, so despite strong fourth quarter results, they may have fallen short, and the profit guidance for the coming year was below as well."

But the company still "sounded quite solid" and "newer businesses are growing rapidly and contributing to profits," Feldman said.

Sales at Walmart US Marketplace grew 34% in the quarter, while Walmart Connect advertising jumped 24%.

TD Cowen analyst Oliver Chen noted that "the big story here is the [price-to-earnings] multiples are very high," which raises expectations of growth. Walmart is currently trading at a forward P/E ratio of 38 times, compared to a three-year average of 24 times.

Despite the stock drop, "we're encouraged that this is conservative and in line with the past in terms of how Walmart guides, and this was a solid quarter, a very stable consumer," Chen added.

D.A. Davidson analyst Michael Baker told Yahoo Finance the stock's dip is a good buying opportunity as the stock still has room to run this year.

"It's one of these names that ... valuation doesn't matter as much," Baker said. "It's more about just fundamentally they're performing well. It's such a big benchmark that investors need to own it."

MY COMMENT

Number one I am tired of the outsize "expectations" game that the media continues to play....over and over. But...of course...my view does not count for much as a "little Person" retail investor.

Two....company "prudence" should be the norm....but now....with the expectations game and the media being NUTS.....companies dont dare.

Three.....it continues to be ridiculous to see other companies....COST, TARGET, etc, etcc....drop simply due to WMT earnings. You might want to wait and see THEIR earnings to judge them. But that is not how the INSANE markets that we are now stuck with work anymore.

 

As to the above....I am ZERO fan of TARGET......but they dont deserve to be punished based on the WMT earnings.

God knows.....they can tank their own earnings very nicely with their recent IDIOCY driving away their customer base....they dont need help doing so from WMT or the media.

 

At the moment the markets have backed off a bit from the INSANITY. I actually have three stocks up at the moment....MSFT, AAPL, and NVDA. PLUS....PLTR has backed way off the earlier losses.

I am now down to ONLY a medium level loss today....and....I expect that the markets WILL move more to the positive before the close.

 

Not bad. BUT...I own both and they are both ICONIC companies. So....fine with me.

Amazon surpasses Walmart in revenue for the first time

https://www.cnbc.com/2025/02/20/amazon-surpasses-walmart-in-revenue-for-first-time-.html

 

I ended in the RED today. With a mild medium loss. the market came back a lot for me today thanks to my three green stocks....NVD, MSFT, AND AAPL. I ended up losing out to the SP500 today by only.....0.20%.

A MORAL VICTORY COMPARED TO THE EARLY MARKET TODAY.