Palantir Technologies (NASDAQ:PLTR) Stock investors got some good news to start their weekend. On Fridays at 8:00 PM ET, Nasdaq (NASDAQ: NDAQ) has announced that the artificial intelligence (AI)-powered software company is joining the Nasdaq-100 index.
This move by Nasdaq – which, among other things, owns and operates the stock exchange of the same name – is part of the annual reconstruction of the Nasdaq-100 index, which includes 100 of the largest non-financial companies listed on the Nasdaq stock market.
Through 2024, Palantir shares are up 343% through Dec. 13 versus S&P500‘s return of 29%. So it’s easy to see how a huge, roughly corresponding increase in Palantir’s market cap earned it a spot on the Nasdaq-100.
The timing of the press release was strategic, as after-hours stock trading in the United States ends at 8:00 PM Dutch time. I suspect Palantir stock would have gotten a boost if this news had been released during regular trading or after-hours.
Along with Palantir, the stocks being added to the Nasdaq-100, launched in 1985, are MicroStrategy And Axon company.
Palantir is a software-as-a-service (SaaS) company that delivers AI-powered software via the cloud. The platforms enable its customers to use their data to increase operational effectiveness and efficiency. Its clients include agencies within the U.S. government and those of our allies and commercial customers.
MicroStrategy operates as an enterprise software company, but most investors probably view it as a pricing play Bitcoin because the company is putting money into buying the cryptocurrency. As of December 13, 2024, shares of MicroStrategy are up 547%.
Axon sells body cameras and other products and services to law enforcement, the military and consumers. Through December 13, Axon shares are up 150% this year.
The three stocks being removed from the Nasdaq-100 are AI server specialists Super microcomputer (NASDAQ:SMCI)genomics-oriented biotechnology Illuminaand biotechnology Modernbest known as the creator of one of two mRNA-based COVID-19 vaccines.
Supermicro shares are up 28% through Dec. 13, 2024, but are down 69% since hitting an all-time high in March. The stock’s big drop is partly due to the weakening of some of the company’s financials. However, it mainly stems from the fallout from a well-known short-seller’s allegations about accounting manipulations and other issues that concern investors. (Short sellers are those who bet on a stock price falling.)
Illumina shares have gained 6% so far this year, while Moderna shares have tumbled 58%, largely due to a sharp drop in sales of the COVID-19 vaccine.
The reconstruction of the Nasdaq-100 index will take effect before the market opens on Monday, December 23.
Membership in the Nasdaq-100 index means that mutual funds, exchange-traded funds (ETFs) and other financial products based on this index will have to buy shares of Palantir. This increased demand should put at least some upward pressure on the stock price.
Membership in a well-known stock index also increases a company’s visibility. Greater awareness of Palantir will expand the pool of potential investors in its stock.
Investors in Palantir stock have had a plethora of good news lately. Notably, the company released a fantastic third-quarter report last month, sending its shares up more than 24% the next day.
In the third quarter, Palantir’s year-over-year revenue and adjusted earnings per share (EPS) rose 30% and 43%, respectively. Both results exceeded Wall Street expectations. Additionally, management raised full-year 2024 expectations for revenue, adjusted operating profit and adjusted free cash flow.
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Beth McKenna has no positions in any of the stocks mentioned. The Motley Fool holds positions in and recommends Axon Enterprise, Bitcoin, and Palantir Technologies. The Motley Fool recommends Illumina, Moderna and Nasdaq. The Motley Fool has a disclosure policy.
Palantir Stock Joins the Nasdaq-100 Index and Super Micro Computer Starts Up: What Investors Need to Know was originally published by The Motley Fool
