Shares of Palantir Technologies (PLTR +5.82%) are up more than 11% over the last week, even as the S&P 500 is about flat for the same period.
Investors seem upbeat about the stock, following an earnings report that showcased rapid enterprise adoption of the company's AI (artificial intelligence) tools.
It's also possible that investors simply think the stock is oversold.
After all, despite its gains over the last week, shares are still down 18% year to date -- a dramatic underperformance compared with the S&P 500's 0.5% gain over the same period.
Whatever the exact reason for the stock's surge over the last week, it's an interesting time to evaluate whether it is a good time to buy.
Soaring sales and profits Palantir's revenue rose 70% year over year to $1.4 billion in its most recent quarter, accelerating from 63% growth in the prior quarter.
This top-line surge was driven by the company's U.S.
commercial segment, where revenue climbed 137% year over year to $507 million.
The software provider is aggressively expanding its footprint beyond its traditional intelligence agency customer base, closing 180 deals worth at least $1 million during the quarter.
Meanwhile, Palantir's legacy U.S.
government business also showed impressive strength, growing 66% year over year to $570 million.
Further, the company is proving it can balance this rapid expansion with substantial profitability.
Palantir's fourth-quarter adjusted free cash flow came in at $791 million, representing a 56% free cash flow margin (free cash flow as a percent of sales).
And a key forward-looking indicator looks good, too.
Palantir's remaining deal value -- a metric tracking the total value of executed....
