Palantir's 80% Surge in 2025 Raises Stock Split Questions

In the first six months of 2025, Palantir stock soared by 80%, reaching near all-time highs. Investors may see the stock as expensive due to its rising share price. Despite the exponential rise, there are more factors to consider with stock splits than just share price. The S&P 500 and Nasdaq-100 indexes generated total returns of 6% and 8% respectively, with Palantir being the top-performing stock. With questions arising about a potential stock split, it’s crucial to understand the implications and whether it would benefit Palantir.

Stock splits are a form of financial engineering that can occur when a company’s share price is perceived as expensive. Palantir’s P/S ratio of 110 has tripled over the past year, making it relatively pricey compared to peers. Although a stock split may make shares appear cheaper, it doesn’t change the company’s valuation. Performing a split could attract new investors but may not be beneficial in the long run, as it could lead to a false sense of affordability and potential sell-offs by institutional investors.

Before investing in Palantir Technologies, consider the analysis from the Motley Fool Stock Advisor team. While Palantir wasn’t among their top 10 stock picks, their selections have historically outperformed the market. Making informed decisions based on valuation and market trends is essential to navigate the complexities of Palantir’s stock performance in the future.

Read more at Nasdaq: After Soaring by 80% During the First Half of 2025, Could This Unstoppable Artificial Intelligence (AI) Stock Be Wall Street’s Next Stock-Split Candidate?