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Palantir's Stock Dips After Expanding Military Contract

2024-12-09

Palantir Technologies (PLTR) made a significant announcement on Monday. It expanded its contract with the U.S. Special Operations Command. This led to initial gains in morning trading for Palantir stock, only to reverse down later.

Stock Market Performance Today

On the current stock market day, Palantir stock witnessed a decline of more than 5%, reaching 72.52 in morning action. As of Friday's market close, it had advanced a remarkable 344% in 2024, with a major portion of the gain occurring after Donald Trump's Presidential election win.

Expanded Contract with U.S. Special Operations Command

Under the expanded contract, Palantir will serve as the lead software integrator for the Mission Command System. The one-year contract is valued at $36.8 million. This showcases Palantir's growing importance in the defense sector.

Trading Questions and Strategies

After holding a stock with gains for a while, one of the key trading questions is where to exit. Sometimes, it is advisable to sell into strength when the market is favorable. At other times, selling on weakness might be a better option when a turn seems to be approaching. A downside reversal, where both elements of strength and weakness are observed in a single day, acts as a sell signal.

Defense Partnerships and Rankings

Palantir stock holds a prominent position on the IBD 50 roster of growth stocks, ranking No. 5. It is also among the AI stocks to watch. In early December, the federal government gave Palantir a higher rating for secure cloud computing services. Additionally, it announced a partnership with Booz Allen Hamilton, a competitor in certain government and defense services. On November 7, Palantir and startup Anthropic partnered with Amazon Web Services to provide U.S. intelligence and defense agencies access to the Claude 3 AI models. In October, it formed an alliance with defense firm L3Harris. Palantir's Relative Strength Rating stands at 99 out of a best-possible 99.

Technical Ratings

According to IBD Stock Check-up, Palantir stock holds a Composite Rating of 99 out of a best-possible 99. This combines five separate proprietary ratings into one easy-to-use rating. The best growth stocks have a Composite Rating of 90 or better. PLTR stock also holds an Accumulation/Distribution Rating of A, which analyzes price and volume changes over the past 13 weeks of trading. A+ indicates heavy institutional buying, while E means heavy selling. A C grade is considered neutral. Palantir stock is significantly extended above an entry point of 29.83, as per MarketSurge.Follow Reinhardt Krause on Twitter @reinhardtk_tech for the latest updates on artificial intelligence, cybersecurity, and cloud computing.

Workday and Apollo Global Management are set to make significant moves in the stock market. As part of the quarterly rebalance, these companies will join the S&P 500 index before the open on Monday, Dec. 23. This has led to notable changes in the stock prices of various entities.

Uncover the Impact of Index Changes on Key Stocks

Workday's Journey in the Index

Workday stock initially jumped on Monday, showing positive momentum. It cleared a 278.98 handle buy point from a consolidation dating back to late February. Despite some pullback from the highs, it still rose by 6%, indicating its potential in the market. The company's inclusion in the S&P 500 is likely to bring more attention and opportunities. 2: Workday's performance is not only about the index inclusion. It has been steadily growing and evolving, with a focus on providing innovative solutions in the enterprise software space. This has helped it gain a competitive edge and attract investors. The company's ability to adapt to market changes and deliver value is crucial for its long-term success.

Apollo Global's Move and Its Impact

Apollo stock initially jumped to fresh highs but later fell 1%. This shows the volatility and uncertainty in the market. Despite the initial surge, the company's stock price has been affected by various factors. Its inclusion in the S&P 500 is expected to bring more visibility and liquidity to the stock. 2: Apollo Global Management has a diverse portfolio and a strong track record in different sectors. Its entry into the S&P 500 will likely attract more institutional investors and increase its market share. The company's ability to generate consistent returns and manage risks is a key factor in its success.

Other Stocks and Index Shifts

AppLovin, one of the hottest stocks in 2024, sold off after being passed over for the S&P 500. This shows the importance of index inclusion and the impact it can have on stock prices. 2: Comerica and Carpenter Technology will move from the S&P SmallCap 600 to the S&P MidCap 400, while Vishay Intertechnology and Carters will make the opposite move. These shifts in the indices will also affect the stock prices of these companies.

Replacement Stocks and Their Performance

Terreno Realty and Champion Homes will replace Hudson Pacific Properties and Regenxbi0 in the S&P SmallCap 600. Both Terreno Realty and Champion Homes rose solidly, indicating their potential in the smaller cap market. 2: Hudson Pacific and Regenxbio also advanced, showing that the market is constantly in flux. These replacement stocks will play an important role in the future performance of the respective indices.Please follow Ed Carson on Threads at @edcarson1971 and X/Twitter at @IBD_ECarson for stock market updates and more.

UnitedHealth's stock took a significant dive over the weekend as it faced intense backlash following the fatal shooting of its CEO, Brian Thompson. Nearly a week later, with law enforcement having arrested a "strong person of interest" in Pennsylvania but not formally charging them, the situation remains highly charged. Thompson was shot outside the Hilton in Midtown Manhattan on December 4 at around 6:45 a.m., and the suspected shooter fled towards Central Park. Multiple outlets reported shell casings with specific words, sparking various discussions.

Investor Concerns and Backlash Impact

Many Americans showed indifference to the shooting, citing their frustrations with the healthcare system. Critics took to social media to share their stories of UnitedHealthcare allegedly denying coverage claims, highlighting the company's focus on the bottom line rather than providing quality coverage. This led to a drop in the value of UnitedHealth's stocks. Several financial experts, like Laura Veldkamp from Columbia University, pointed out that investors are concerned about the potential negative effects of the backlash on their investments. It raises questions about the balance between shareholder and stakeholder value. In the short term, politics may prevent immediate regulatory changes, but the long-term implications are significant.

Short-Term and Long-Term Perspectives

In the short term, as noted by Laura Veldkamp, the "dysfunctional" state of politics makes it unlikely that the industry will face new regulations due to the backlash. However, consumers have limited options as most get their insurance through employers. In the long term, it is crucial for UnitedHealth to address these issues. David Park from Syracuse University emphasized that events like this can have a lasting impact on a firm's perceived corporate responsibility and ethical standards. Media and public scrutiny can fuel investors' concerns about customer loyalty and financial performance.

Steps to Rebuild Trust

UnitedHealth can take several steps to rebuild trust. As suggested by David Park, transparent communication about the root causes of the crisis and concrete steps to prevent future occurrences is essential. This could include third-party audits of internal policies, public disclosure of enhanced security measures, and the hiring of independent experts to review and recommend improvements. Addressing concerns about claims transparency is also crucial in fixing its reputation. Stephen Ciccone from the University of New Hampshire noted that other insurance companies are facing similar scrutiny and have seen stock price declines. If UnitedHealth doesn't take steps, consumer dissatisfaction will persist, and the industry may face increased government regulation.