It’s earnings season, meaning that traders have ideal opportunities to capitalize with leveraged ETFs, particularly those of the single-stock variety.
Among the upcoming tentpole reports is Palantir (PLTR), which is slated for Monday, Aug. 3, after the U.S. market closes. The previously beloved tech stock fell on hard times this year amid fears of artificial intelligence (AI) disruption. But even with a 30% year-to-date decline, the $289 billion tech giant’s upcoming earnings report will be widely watched.
It could also put the spotlight on the Direxion Daily PLTR Bull 2X Shares (PLTU). One of the members of Direxion’s extensive roster of single-stock ETFs, PLTU is designed to deliver 200% of the daily returns of Palantir shares. Alternatively, PLTU could be an ideal way for aggressive traders to play Palantir earnings.
It’s All About Outcomes
Investors are treating Palantir as a “show me” story, meaning they want to see tangible, positive outcomes. If that progress is displayed in the earnings report, PLTU could rally.
“We’re watching whether frontier model providers can replicate Palantir’s ontology. Right now, we see a meaningful delta between Palantir’s ontology and frontier model incentives,” noted Mark Giarelli of Morningstar. “Palantir needs to deliver outcomes, while frontier model companies are incentivized to ‘burn’ tokens. As it stands with the frontier providers, positive enterprise outcomes are good for business, but less essential than it is for Palantir, the governed operating layer of the enterprise.”
Another potential catalyst for post-earnings upside for the stock and PLTU is international growth. Fortunately, that’s not necessary to facilitate a pop in the stock due to Palantir’s rapid growth here in the U.S.
“Palantir management has been verbose in their explanations of why European adoption has been slow, but they mostly cite philosophical differences, bureaucratic red tape, etc.,” added Giarelli. “Overall, Palantir is growing so fast in the United States that they don’t necessarily need Europe, but European growth would be a massive accelerant to the upside and make the valuation math work a lot better.”
Speaking of growth, any commentary offered by Palantir on long-term growth could be a spark for PLTU even though the ETF is inherently a short-term instrument.
“Our base case has Palantir’s TAM growing to $1.4 trillion by 2033. We forecast an average annual growth of 52% between 2026 and 2028. Our analysis concludes that we are in the early innings of an AI revolution,” concluded Giarelli.
For more news, information, and strategy, visit the Leveraged & Inverse Content Hub.