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It’s one of the most unusual and puzzling initial public offerings in Wall Street history. The Palantir company, named after a kind of crystal ball from the “Lord of the Rings” series of novels, listed its shares on the New York Stock Exchange for the first time. The first exchange took hours to complete. Then the stock rallied quickly by more than 50 percent.
Before the outbreak of the pandemic, IPOs gave the environment on the floor an extra boost of energy. Business representatives were allowed to ring the opening or closing bell. Traders received baseball caps or T-shirts with the company logo. An oversized golden bell was often placed on the floor for the first exchange.
In the days of Corona and with strict rules of distance, Palantir’s debut was at least visually less spectacular. There were no photographs of boisterous distributors or top managers. However, that does little to change the fact that it is one of the most extraordinary IPOs in recent history.
Involved in the search for Bin Laden?
Palantir specializes in data analysis. Larger clients include US intelligence agencies and authorities These include the CIA, FBI, NSA, and ICE immigration service. There are unconfirmed media reports that Palantir’s software was used in the search for Osama bin Laden, the founder of the terrorist organization Al Qaeda.
Alex Karp and his company want to get started in the stock market.
Keystone
Palantir specializes in analyzing large amounts of data. For example, data from social media is combined with phone data and information from power companies or healthcare providers. The company pays particular attention to a high level of user-friendliness and configures the software according to the special wishes of each individual customer. This is aimed at establishing a correspondingly close and loyal customer relationship.
The strongest growth in history?
Like many companies that are currently publicly traded, Palantir is not making a profit, and is unlikely to do so in the near future. Last fiscal year, the loss was just under $ 580 million. For the current year, a turnover of around one billion dollars is expected. With an increase of 42 percent, it would be the strongest growth in the company’s history.
However, not only is the mysterious environment unusual, but also the initial public offering itself, which is what is called a direct listing. No new share certificates will be issued, but current owners and early investors cover the demand on the stock exchange with their own share certificates.
Control of most for life
The company itself does not initially receive any fresh capital. In return, the usual road shows and the subscription of investment banks are avoided with a direct listing. Slack in 2018 and Spotify in 2019 were among the few direct listings in Wall Street history. Both stocks initially had a difficult time on the stock market.
At Palantir, according to the “Financial Times,” the three founders Peter Thiel, CEO Alex Karp and Stephen Cohen will retain majority control of Palantir for life, regardless of the IPO. That is also extremely unusual. But at a time when central banks are flooding the markets with cheap money like never before, this doesn’t seem to deter investors at the moment.
