Palantir Stock Rises. Here’s What May Be Lifting the Shares.

Palantir Technologies said it had entered into a strategic partnership with Accenture Federal Services. (AFP via Getty Images)

Palantir Technologies was rising Monday after ending Friday’s session as the worst-performing stock in the S&P 500.

Shares climbed 5.1% to $137.46 as the data-analytics company unveiled a strategic partnership with Accenture Federal Services, the government-facing arm of Accenture. As part of the collaboration, the partners will train Accenture Federal’s 1,000-person-strong Data & AI team on Palantir software including its flagship Artificial Intelligence Platform.

The latest stock moves also coincided with the annual Russell 1000 reconstitution. Changes to the index, which tracks the top 1,000 large-cap names, took effect after markets shuttered on June 27. Palantir was among the names added to the index, but the reshuffling forced small-cap funds tracking the Russell 2000 to unload Palantir stock as it crossed into large-cap territory. The latest gains may simply reflect a recovery after a selloff.

Changes to the S&P 500 following its quarterly rebalance also were set to take effect on Monday. Although Palantir has been part of the index since last September, S&P Dow Jones Indices also adjusts the weight of existing constituents to reflect changes in share count and float. The latest adjustment could trigger downward pressure on the stock as it not only provides fund managers an opportunity to sell, but forces investors to reconsider Palantir’s sky-high valuation.

Palantir rallied last week to notch a record intraday high of $148.22 on Thursday. However, shares fell sharply on the heels of the gains to close down 9.4% on Friday.

Despite Friday’s sharp decline, the stock remains up 82% this year. Since joining the S&P 500 on Sept. 23, 2024, Palantir has surged about 269%.

Write to Mackenzie Tatananni at mackenzie.tatananni@barrons.com