2024 has been a milestone yr for knowledge analytics firm Palantir Applied sciences (NYSE: PLTR). Maybe most necessary occasion for the corporate was its addition to the S&P 500 earlier this yr — an achievement few thought was attainable simply 4 years in the past when Palantir went public and was rapidly written off as a glorified authorities contracting and consulting operation with no actual expertise capabilities.
That narrative has come to an finish. Over the past couple of years, Palantir has entered a brand new part of progress due to the corporate’s profitable launch of a brand new software program suite referred to as the Synthetic Intelligence Platform (AIP).
All of those components have contributed to notable curiosity in Palantir inventory over the past a number of months. On the time of this writing, shares of Palantir have gained 283% yr thus far. With the inventory hovering round an all-time excessive valuation, can it probably hold climbing larger?
In my eyes, I feel Palantir inventory is about to proceed operating. Under, I will break down the corporate’s newest announcement and level to why buyers ought to have their eyes on Palantir inventory on Nov. 26.
Palantir’s newest massive announcement
One factor that always goes ignored with shares is the exchange that they commerce on. However, imagine it or not, buying and selling on the New York Inventory Alternate (NYSE) versus the Nasdaq Inventory Market can even have some fairly massive implications for an organization.
Just a few days in the past, Palantir introduced that it’s shifting its itemizing from the NYSE to the Nasdaq. Shares of Palantir are anticipated to start buying and selling on the Nasdaq on Nov. 26.
On the floor, this may increasingly seem to be mundane information. However beneath I’ll break down quite a lot of examples of different firms which have switched to the Nasdaq and illustrate how their share costs moved following the transition.
Picture supply: Getty Pictures.
Historical past is on Palantir’s aspect
Under, I’ve outlined two firms which have moved from their authentic inventory alternate to the Nasdaq lately.
Workday: On Sept. 1, 2017, software program firm Workday introduced that it was switching from the NYSE to the Nasdaq. Shares of Workday started buying and selling on the Nasdaq a few weeks later, on Sept. 20. Right here is how Workday inventory has moved since changing into a Nasdaq-traded safety:
- Between Sept. 1, 2017, and Sept. 20, 2017, shares declined by a nominal 2%.
- Between Sept. 20, 2017, and Sept. 20, 2018, the inventory gained greater than 30%.
- Since changing into a member of the Nasdaq, the inventory has elevated 144%.
PepsiCo: On Dec. 8, 2017, beverage and snack conglomerate PepsiCo introduced that it was shifting from the NYSE to the Nasdaq. PepsiCo started buying and selling as a member of the Nasdaq on December 20, 2017.
- Between Dec. 8, 2017, and Dec. 20, 2017, shares rose by a nominal 2%.
- Between Dec. 20, 2017, and Dec. 20, 2018, the inventory dropped roughly 7%.
- Since changing into a member on the Nasdaq, the inventory has elevated 33%.
I feel the choice to maneuver to the Nasdaq benefited PepsiCo and Workday in quite a lot of methods. First, the Nasdaq is usually affiliated with expertise, progress, and innovation. Whereas PepsiCo is a shopper packaged items empire, I feel the transfer to the Nasdaq helped the corporate’s notion as extra of a growth stock and fewer of an earthly soda and snack enterprise.
As well as, each Workday and PepsiCo joined the Nasdaq-100 following their respective strikes from the NYSE. Incomes inclusion into the Nasdaq-100 index may also help an organization land on extra investor radars. As such, will increase in buying and selling quantity and shopping for can happen which positively influences inventory costs.
What I feel will occur after Palantir’s debut on the Nasdaq
Whereas the information about Palantir’s change from the NYSE to the Nasdaq is fascinating, you are most likely questioning why an organization would do that within the first place.
To be trustworthy, there are lots of causes that would affect an organization’s determination to maneuver exchanges. A few of the extra pedantic components could possibly be associated to charges related to totally different inventory exchanges, for instance. In my eyes, the associated fee constructions amongst totally different exchanges is not actually a priority for Palantir.
Relatively, I feel the transfer to the Nasdaq is rooted in branding. Whereas the Nasdaq is house to firms in many various industries, it’s mostly affiliated with the expertise sector. Given Palantir’s success all through the AI revolution, I feel the notion of the corporate being a consulting enterprise for the federal government has been erased.
Palantir’s close alliance with big tech cements the corporate as a robust drive within the AI business, and I feel shifting to the Nasdaq will assist strengthen the corporate’s picture as a official participant within the expertise realm.
I beforehand predicted that Palantir’s inclusion into the S&P 500 would assist get the corporate on the radar of extra institutional buyers. I am now doubling down on this stance, as changing into a member of the Nasdaq ought to assist higher place Palantir as a gorgeous progress inventory in a sea of main expertise firms.
Some analysts are already projecting that elevated institutional shopping for together with the highlight of the Nasdaq might propel Palantir into the coveted Nasdaq-100 index. Ought to that come to fruition, I feel it is virtually a certainty that the corporate’s share worth will proceed hovering.
Whereas I can not say for sure what’s going to occur, Palantir’s inventory worth has already skilled some momentum following the information of the corporate’s swap from the NYSE. I feel buying and selling on the Nasdaq will assist Palantir grow to be extra widely known as a number one alternative in AI and the expertise arenas over time. For these causes, I feel the inventory will observe the developments I outlined above and proceed hovering after its transfer to the Nasdaq.
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Adam Spatacco has positions in Palantir Applied sciences. The Motley Idiot has positions in and recommends Palantir Applied sciences and Workday. The Motley Idiot has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the creator and don’t essentially mirror these of Nasdaq, Inc.
