This Artificial Intelligence (AI) Stock Has Surged 1,000% Over the Past 2 Years. Is a Split on the Horizon?

Core Viewpoint - Palantir Technologies has experienced significant stock price fluctuations, with a recent decline of approximately 30% from its all-time high, despite a remarkable increase of about 1,000% over the past two years, driven by excitement around artificial intelligence (AI) and the company's growth potential [1][2]. Group 1: Stock Performance - Palantir's stock was at an all-time high less than a month ago but has since dropped around 30% as the Nasdaq Composite entered a correction [1]. - Despite the recent decline, the stock has increased about 1,000% over the past two years [1]. - The S&P 500 historically returns an average of roughly 10% annually, highlighting Palantir's exceptional performance relative to broader market trends [2]. Group 2: Stock Split Considerations - The primary benefit of stock splits is to make shares easier to buy or sell, potentially removing emotional barriers for investors focused on share price rather than value [5]. - Palantir's stock closed at $78, indicating that the current price is not excessively high, which diminishes the immediate need for a stock split [6]. - Recent price momentum has turned lower, with shares falling over 30% in recent weeks, which may argue against an impending stock split [9]. Group 3: Market Sentiment and Valuation - A stock split is often viewed positively when a company's stock is performing well, but could send a negative message if executed during a downturn [8]. - Palantir's current slide in share price could lead to a perception of weakness, making a stock split less likely [9]. - The company's aggressive valuation, particularly in comparison to other AI stocks, raises concerns about its sustainability, with a potential 50% drop in share price if valuation normalizes [10][12].