Planet Labs (PL): Evaluating Valuation After Tanager-1 Launch and German Production Expansion News

If you have been following Planet Labs PBC (PL), the recent surge in the stock will have certainly grabbed your attention. The company just announced the commercial availability of cutting-edge data products from its Tanager-1 satellite, including a Methane Quicklook tool built with Carbon Mapper. This means customers now have access to advanced Earth imaging solutions for emissions detection and a wide range of applications, spanning natural resource management and disaster response. In addition, news of expanded high-resolution satellite production in Germany is putting a spotlight on the company’s operational momentum and international ambitions.

These announcements tap directly into growing demand for actionable satellite data, and the market responded quickly. Over the past month, shares of Planet Labs have climbed over 72% and are up a remarkable 104% in the past three months, pushing the stock to a new all-time high. The stock’s upward momentum has been reinforced by recent partnership wins and revenue growth, feeding investor optimism about future growth prospects in the face of competitive and financial challenges.

With so much recent excitement fueling its share price, is the market giving Planet Labs too much credit for its growth profile, or could there still be meaningful upside for buyers at these levels?

Most Popular Narrative: 7.9% Overvalued

According to the most widely followed narrative, Planet Labs' shares are currently priced above fair value by nearly 8%. This user-driven perspective signals that, despite the company's rapid growth and industry leadership, bullish sentiment may have gotten ahead of underlying fundamentals.

Planet Labs leads the EO market with the largest satellite constellation. The company is poised to capitalize on the growing demand for Earth Observation and geospatial data from companies and governments. Plunging space launch and GPU computation costs, combined with advancements in CubeSat and AI technologies, are boosting the utility of Earth Observation data.

What is the secret sauce behind this hot valuation? There are bold assumptions at play here, including unique growth forecasts, calculated profit margins, and a future earnings multiple more often seen in elite tech stocks. Are these projections realistic, or is there a twist hidden beneath the surface results? Get ready to dive deeper into the full narrative and discover which levers are fueling the current fair value calculation.

Result: Fair Value of $11.31 (OVERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, uncertain commercial adoption and potential delays in government contracts could quickly undermine the current bullish outlook.

Find out about the key risks to this Planet Labs PBC narrative.

Another View: SWS DCF Model Paints a Cautious Picture

While the first valuation suggests optimism for Planet Labs, our DCF model provides a different angle. It indicates the stock may be priced well above what its future cash flows could support. Which perspective deserves more weight?

Look into how the SWS DCF model arrives at its fair value.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Planet Labs PBC for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Build Your Own Planet Labs PBC Narrative

If you see Planet Labs PBC's story through a different lens, take control and shape your own view using the same data in just a few minutes. Do it your way

A great starting point for your Planet Labs PBC research is our analysis highlighting 2 key rewards and 2 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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