As Mideast war expands, Palantir rises
Palantir is the best-performing stock in the S&P 500 over the last three months.
The market keeps moving, even amid the spiraling tragedy in the Middle East.
The rapid deterioration of the situation — which over just the last few weeks has evolved from a war in Gaza to include Israeli attacks on Hezbollah, and an incursion into southern Lebanon as well as retaliatory Iranian missile strikes on Israel (which the American military was involved in repelling) — has kept the overall market in a state of limbo for a couple weeks.
One of the exceptions, however, is Palantir Technologies.
In fact, the defense and intelligence software firm is the best-performing stock in the S&P 500 over the last three months. Over the last year, the company’s shares are up more than 150%.
This is in part because of its admission to the S&P 500 last month. (Addition to such benchmark indexes typically creates a burst of buying activity, as index funds — and closet indexers — are essentially forced to buy the shares in order to ensure their performance mirrors the index.) Palantir, like utilities stocks, is also benefitting from excitement surrounding any and all things AI.
But Palantir — a name derived from the seeing stones known as palantíri in the Middle Earth sagas of J.R.R. Tolkien — also has significant ties to the Israeli defense establishment. The company held its first board meeting of the year in Tel Aviv, after which CEO Alex Karp traveled to Ministry of Defense headquarters to publicly sign a strategic partnership agreement, of which few details were known.
Bloomberg has reported that demand for Palantir’s services in Israel have risen since the Hamas attack of Oct. 7, 2023 — in which 1,200 were killed and over 200 hostages taken — triggered a Gaza conflict in which more than 40,000 have died.
“The world is on the precipice of what could be a very severe set of violent interactions in the Middle East,” Karp told analysts on the company’s most recent earnings call back in August, as it announced record quarterly sales and profit. “And it goes without saying that at Palantir, we know where we stand and we are very much supporting America and its allies in the Middle East, including Israel.”
