Who is included in the Nasdaq 100 index together with WeStrategy?

As part of the index restructuring, Palantir ( PLTR ), MicroStrategy ( MSTR ) and Axon Enterprise ( AXON ) will join the Nasdaq 100 Index on Monday, December 23, replacing Super Micro Computer ( SMCI ), Moderna ( MRNA ) and Illumina ( ILMN ). The three companies to be included in the index are all technology companies. This adjustment will enhance the representation of important technology and innovation sectors in the index. In addition, the adjustment of Nasdaq 100 index constituent stocks supports Nasdaq’s position as a global leading technology company and provides enhanced benchmark capabilities for various financial products. The announcement also stated that newly included companies in the index usually have higher visibility and investor attention, which may improve their market performance.

Last month, artificial intelligence darling NVIDIA ( NVDA ) joined the Dow Jones Industries Average Index , replacing legendary chipmaker Intel ( INTC ). Paint manufacturer SHW also replaced chemical giant Dow ( DOW ) to join the index.

This shows that major US exchanges have responded positively to the latest developments in the industrial and technology sectors to maintain their authority in expressing economic activities.

What is NASDAQ 100?

It is an index composed of the 100 largest non-financial companies listed on the NASDAQ exchange. There are many globally renowned tech giants, such as Apple, Microsoft, Amazon, Google, etc. It can be said that the NASDAQ 100 represents the development trend of the global technology industry and is also a representative of US stocks. The NASDAQ 100 index has performed well this year. As of December 14th, the year’s increase reached 29.44%, surpassing major indexes such as the NASDAQ index, S & P 500 index, and Dow Jones Industries Average Index.

Who is Micro Strategy?

Micro Strategy’s inclusion in the Nasdaq 100 index has been controversial. The company’s stock price has risen by as much as 500% this year. It is worth noting that the company is accelerating an unconventional plan to raise funds to buy and hold more Bitcoin. In the past five weeks, the company has announced every Monday that it will spend billions of dollars to acquire Bitcoin.

Micro Strategy currently holds more than $40 billion worth of Bitcoin as the price breaks through $100,000 and continues to hit record highs. However, its underlying business had a net loss of $340 million in the third quarter of this year. Nevertheless, the company’s market value of $98 billion is largely based on its strategy of buying and holding Bitcoin. Micro Strategy aims to raise $42 billion in funding through publish stock and Fixed Income securities in the next three years, and has exceeded its 2025 equity stake financing target.

Some analysts believe that the company has become a leveraged bitcoin betting company, and therefore does not qualify for inclusion in the Nasdaq’s top 100 stocks.

However, some analysts believe that the concept of the index should truly represent all stocks in the stock market. Any large company that occupies an important position in the NASDAQ market should be included in the index.

Some fund managers even say that this company is more like a commodity or ETF, because without Bitcoin, it is “essentially a bankrupt company”. He believes that the company should be reclassified as a financial company next year. “100% of the company’s value comes from Bitcoin, because other parts of the company may be negative. Most of the company’s assets are purely its holdings of Bitcoin and related financial operations, so it is a financial company.”

Who is Palantir?

Palantir (stock code PLTR) is known as the “Messi of artificial intelligence growth”, demonstrating its outstanding performance and huge potential in the field of AI.

Palantir is a company that specializes in Data Analysis and Software Development. It provides platforms and tools that help enterprises, government entities, and other organizations manage, analyze, and interpret large-scale datasets. Palantir’s solutions are known for their high degree of customization, which can meet the specific needs of customers, thus building loyalty and product stickiness in the customer base. The company’s products are widely used in multiple fields, including defense, intelligence, finance, healthcare, and manufacturing, helping customers improve decision-making efficiency and workflow automation. In the field of artificial intelligence, Palantir is highly valued and in demand for its innovation and effectiveness in the artificial intelligence platform (AIP).

Palantir Technologies Inc. was founded in 2003 by Peter Thiel, Nathan Gettings, Joe Lonsdale, Stephen Cohen, and Alex Karp. The company’s name comes from “The Lord of the Rings,” in which the magical crystal of truth is the “seeing stone,” described as an indestructible crystal ball used for communication and reconnaissance of events in other parts of the world. After the bursting of the Internet bubble in 2000, Silicon Valley technology companies focused on the development of databases, Internet applications, and other fields. However, Palantir (Palantir) took an unconventional approach, also developing data technology, but did espionage work for the US government. This was simply not presentable to a group of rebellious internet geniuses in Silicon Valley. Palantir’s development did not rely on the cultivation of several computers in a garage like traditional technology innovation companies. Instead, it relied on the secret investment of IN-Q-Tel, a secret fund of the US Central Intelligence Agency (CIA). With the support of the government and the efforts of a group of talented engineers, Palantir quickly grew and expanded. It not only received clients from the US government, but also did private work for countries such as the United Kingdom and Sweden. In the eyes of many Americans, working for the government is considered doing bad things, but it is not necessarily the case. For example, the US military located and killed terrorist leader Osama bin Laden by relying on PALANTIR’s Gotham platform Data Analysis. Because it involves the military, this matter has not been officially recognized by the government, but the possibility is very high.

Wedbush analyst Daniel Ives pointed out that the demand for Palantir’s AI platform (AIP) is unprecedentedly high, and companies are increasingly recognizing the value of its product suite. Since September, Palantir’s stock price has surged 61%, despite increasing investment risks, but analysts still maintain a hold rating. Palantir focuses on Data Analysis and software customization, providing customers with specific solutions to build customer loyalty with high gross margins and solid growth. The high switching costs of abandoning its customized solutions make customers reluctant to switch suppliers. CEO Alex Karp revealed in the Q3 earnings call that the company’s US business grew 44% year-on-year on a $2 billion basis, exceeding expectations. In the quarter, Palantir achieved non-GAAP earnings per share of $0.10, exceeding expectations by $0.01, with revenue reaching $725.52 million, a year-on-year increase of 30%, exceeding expectations of $21.83 million. The revenue forecast for fiscal year 2024 has been raised to $2.805 billion to $2.809 billion, while the adjusted operating income forecast has been raised to $1.054 billion to $1.058 billion, and the adjusted free cash flow forecast exceeds $1 billion. Palantir’s AIP platform has significant influence in the AI economy. For example, a global insurance company reduced the underwriting process time from two weeks to three hours through AIP, and increased Associated Materials’ on-time and full delivery rate from 40% to 90% in just nine months. This significant efficiency improvement creates asymmetric advantages for customers. In addition, Palantir’s net dollar Retention Rate reached 118% this quarter, an increase of 11 percentage points year-on-year, but this data has not yet fully reflected the revenue growth brought by new customers. With the acceleration of revenue growth, the net dollar Retention Rate is expected to further increase in the coming quarters.

Who is Axon Enterprise?

Axon’s inclusion in the NASDAQ 100 index has been less controversial. The company is known for law enforcement tools such as Taser guns and body cameras, and is currently building a future public safety operating system by integrating hardware devices and cloud software solutions. The system can revolutionize modern law enforcement and meet the security needs of federal agencies, prisons, judiciary, and enterprises. Axon’s product suite includes cloud-hosted digital evidence management, productivity and real-time operation software, wearable cameras, in-car cameras, Taser energy devices, robot security and training solutions.

Axon’s business covers multiple aspects.

• Law enforcement technology products: The company’s main products include TASER stun guns, police cameras (such as Axon Body), digital evidence management platforms (such as Evidence.com ), etc., providing law enforcement agencies with comprehensive solutions to help improve work efficiency and safety.
• Artificial intelligence and Data Analysis: Axon uses advanced artificial intelligence technology and Big Data Analysis capabilities to help law enforcement agencies better manage and utilize policing data, thereby improving their ability to prevent and combat crime.
• Legal technology services: The company also provides legal technology services, such as e-discovery and legal document management, to support law firms and corporate clients.

In the first three quarters of this year, the company’s revenue grew by more than 30%, and the growth rate has exceeded 25% for 11 consecutive quarters. In the secondary market, the company’s stock has risen by as much as 149% this year. As of December, among the 16 analysts covering the stock, 14 gave a strong buy or buy rating, and the remaining 2 gave a hold rating.

Summary

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