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Morning Markets: New reporting sheds new light on what Palantir may, and may not be worth.

, a pseudo-stealthy big data unicorn is moving its value around. The company, perhaps best known for its , has been in the news for other reasons over the last year, including its , , and, of course, an impending IPO.

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That Palantir is valuable is agreed upon. How much Palantir is worth today, and what it may be worth if it were to go public each have less-clear answers.

Recent reporting further complicates already difficult answers to the value question. Palantir, , has reduced the price of employee stock options, lowering the value of the company by that metric to $11 billion.

Of course, $11 billion is nearly a dozen billion dollars so the firm is still quite valuable. But compared to the figure Palantir has flirted with regarding its future worth during an IPO, it’s paltry. Let’s quickly remember what we know about Palantir, and then sort the new data into the mix.

Revenue, Value

Palantir’s 2018 seemed to get better as it went along. When Palantir was considering an IPO in October of last year it was expected to report $750 million in full-year revenue, , up from $600 million the year before. Later, higher expectations were , indicating that Palantir would land closer to $1 billion in topline.

Against those figures was a $41 billion valuation floated by bankers. I was quite skeptical of that figure compared to the $750 million revenue figure. Its聽multiples inched down when its revenue reportedly reached higher, but the math just didn’t seem to square; for Palantir to hope for a revenue multiple as high as a $41 billion value and a revenue result of no more than $1 billion, it would need to grow more than 50 percent or so from 2017 to 2018.

At least according to the current math聽that the markets currently provide.

This brings us back to the latest Palantir that Palantir is reducing the valuation at which its employees can buy stock in their company. Here’s the key bit:

“[I]n recent months, the data-analysis company took the unusual step of slashing the price of employee stock options to about $6 a share, which would value the business at about $11 billion,聽said people with knowledge of the matter.聽

Unicorn valuations are tricky. Small pieces of companies are often sold, theoretically changing the value of the whole firm. Stripe’s at a valuation of more than $22 billion is a good example of the effect. That sale was for 0.4 percent of the company. How fair it is to reprice the whole firm off of such a small sale, I leave to you.

Palantir reducing its valuation for workers to $11 billion does seem material, in contrast. I cannot find any way to harmonize the $11 billion figure and the $41 billion figure; they are simply too far apart, and only one makes sense when compared to the revenue base that Palantir sports.

It’s unclear when Palantir will go public, but the company has to not provide a material exit. We’ll see.

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