Aug. 18 at 3:30 AM
$PLTR mpact of +0.25% Rate Hike on P/E Multiple (
$170 Baseline)
Assumed Equity Duration Price Impact (%) Theoretical Price Contracted P/E Multiple
10 Years -2.50%
$165.75 146.3x
15 Years -3.75%
$163.62 144.4x
20 Years -5.00%
$161.50 142.5x
25 Years -6.25%
$159.38 140.6x
Why High P/E Magnifies Rate Sensitivity
⚬ Duration Concentration: At 150x P/E, over 90% of Palantir's discounted cash flow valuation comes from earnings expected 10+ years in the future.
⚬ Discount Factor Formula: The present value of future earnings is calculated using the discount factor:
$
$PV = \frac{CF_t}{(1 + r + \Delta r)^t}$$
