Planet Labs: 500% Rally, Growth Case Still Intact

Deep Value Investing11.75K FollowersFollow5ShareSavePlay(9min)Comment(1)SummaryI still see Planet Labs PBC as a top-line growth story, with FY27 revenue guided to $415M-$440M and 67% of its $900M backlog converting over the next two years.PL's backlog was up 79% in the last fiscal year. I think there is more room for growth in the back half of this year.I believe the Defense & Intelligence segment is the key upside area, with FY26 revenue up 50% and potential tailwinds from the proposed $1.5 trillion U.S. defense budget for 2027.I downgraded to Buy because the stock has surged over 500% in 12 months, trades around 24x forward sales, and FY27 adjusted EBITDA guidance is only $0-$10 million.I wouldn't be surprised to see a PL stock pullback in the next weeks/months as investors take profits. That said, long term, I remain bullish on PL stock and I still own it in my portfolio.

Nico De Pasquale Photography/DigitalVision via Getty Images About a month ago, I initiated coverage on Planet Labs PBC (PL) with a Strong Buy rating, citing a compelling growth story with a $1.5T catalyst in the second half of theThis article was written byDeep Value Investing11.75K FollowersFollowSmall deep value individual investor, with a modest private investment portfolio, split approx. 50%-50% between shares and call options. I have a B.Sc. in aeronautical engineering and over 6 years of experience as an engineering consultant in the aerospace sector. The latter statement is not relevant in any way whatsoever to my investment style, but I thought to add it for self-indulgent purposes. I have a contrarian investment style, highly risky, and often dealing with illiquid options. How illiquid? Well, you can land a Jumbo on the spread and still have clearance for take-off. From time to time, I buy shares, mostly to not be categorized as a degen by my fellow investor friends, therefore the 50%-50% allocation. My timeframe tends to be between 3-24 months.I like stocks that have experienced a recent sell-off due to non-recurrent events, particularly when insiders are buying shares at the new lower price. This is how I often screen through thousands of stocks, mainly in the US, although I may own shares in banana republics. I use fundamental analysis to check the health of companies that pass through my screening process, their leverage, and then compare their financial ratios with the sector, and industry median and average. I also do professional background checks of each insider who purchased shares after the recent sell-off. I use technical analysis to optimize the entry and exit points of my positions. I mainly use multicolor lines for support and resistance levels on weekly charts. From time to time I draw trend lines, taken for granted, in multicolor patterns. Note: I tried to keep my introduction as real, and authentic as possible. I dislike empty suits, high-level BS, deep-level BS, unnecessary jargon, and self-indulgent, third-person written introductions with an air of superiority.Thanks for reading my introduction!Analyst’s Disclosure: I/we have a beneficial long position in the shares of PL, RCAT, RKLB, VSAT either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.