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Public Markets Investor, Opportunistic Buying & Cost-Basis Management
Among government contractors, CACI is the one worth owning because it alone has delivered beautiful returns over the last 10-12 years and the post-Covid period, while Leidos and Booz Allen Hamilton have badly lagged the S&P 500. Leidos also faces a tough fight against Palantir, the risk @griffonomics flags, and the administration's hostility toward Booz Allen means there is no hurry to buy it back. x.comÂ
Palantir's government contract activity is growing sharply, supporting its resilience despite the share-price pullback. Its $2.1 billion in 12-month obligations is up 184% from the prior year, among the strongest increases tracked. The Cryptic Bottom Index remains green despite the pullback. Its score is among the highest in the Cryptic Research System, led by growth and profitability, though catalysts and valuation score weakest. x.com x.com x.comÂ
Palantir's reliance on pay-as-you-go service with refunds makes customer cancellations and sudden earnings declines or write-downs a serious risk as AI and high SaaS prices pressure the business. Its 10-Q warns of these risks. Anthropic can and will easily replace Palantir with an all-in-one platform under Democratic control of the legislative branches. x.com x.comÂ
Leidos remains an attractive name to own. x.comÂ
Palantir's long-term moat is hard to assert in a heavily computational space. Clients have an incentive to remove inefficiencies, and it will become increasingly easy for them to drop its value proposition and build their own, so there are better picks. x.comÂ
Palantir is irreplaceable even if it is probably overvalued on traditional metrics at $150. Its government contract moats, new defense AI deals and one of the most defensible software positions in enterprise AI support the stock. Overvalued and irreplaceable are not mutually exclusive. x.comÂ
Palantir's high-margin consulting layer is being commoditized as frontier models make complex data orchestration cheap and fast. Enterprises need not spend $10 million and 18 months on a rigid Foundry ontology when frontier models can parse messy data and build workflows in hours; Alex Karp's token-fee complaints reflect that. Its national-security moat is cracking as military operators use tools like Claude Code directly, and talent is fleeing to frontier labs. Palantir is a short. x.comÂ
Palantir is a business worth owning: its AI and data software helps customers easily understand their data, it is growing fast with long-term US government deals, and switching to a competitor is very hard and expensive for clients once they use it. x.comÂ
CACI International looks cheap at about 14x EV/EBITDA given its optionality in electronic warfare, Iron Dome-style missile defense and laser or optical space transmission. x.comÂ
IT services firms and government contractors such as Accenture, Booz Allen Hamilton and Cognizant face a double hit from government downsizing and AI disruption. The slide began in January 2025 as DOGE and the incoming Trump administration promised to shrink the federal workforce, and every government employee laid off affects about three contractors and many programs. AI is the frosting on the cake, with @mukund saying AI has begun eating IT services and consulting. x.comÂ
Palantir's valuation premium is shrinking because it is no longer the only player in defense AI. Its 2024-25 run at hundreds of times earnings rested on being first and only there, but frontier labs it once partnered with now sign directly with the Pentagon, and OpenAI and Anthropic are moving into forward-deployed engineering for enterprises. CEO Alex Karp's attack on the labs reflects that pressure. Opportunity returns once revenue and profit scale up and the valuation is digested. x.comÂ
