• Coronavirus Complications: With President Trump and several Republican senators currently infected with coronavirus volatility is expected to remain high this week as investors decipher whether Congress will be able to pass a fresh stimulus package and continue proceeding with the controversial supreme court nomination. For now there seems to be temporary optimism in regards to the potential stimulus as President Trump tweeted Saturday from the hospital urging congress to “get it done”
• Palantir’s Public Problems: Last Wednesday Palantir came to market through the uncommon process of a direct listing. The process, however, was anything but smooth as the listing date had to be moved twice and the company had trouble locating several of its shareholders. Despite this disorganization and many investors’ frustrations the company’s value appears to be holding steady around $20 billion, which is the same valuation it was awarded in its last private round five years ago.
• Job Growth Slows: The recent jobs data showed a drop in the number of individuals working part time who would rather be full. This positive news, however, was offset but the fact that job growth slowed from 4% per month back in May and June to just 1% per month in July, August, and September. As a result, there are still 11.7 million less Americans working now than there were back in February. Many analysts are also worried about future employment numbers as the public sector has increased layoffs. For example, public schools and universities cut 8% of their employees while cities and municipalities cut around 5% of their workers.
• Untapped IPO Value: So far in 2020 there have been 127 IPOs in the US (excluding SPACs). On average these newly issued stocks have risen 38% on their first day, which means that these companies lost out on an aggregate of $24 billion – the most since 2000 during the dot com bubble. This IPO “mispricing” was highlighted last week when SnowFlake (SNOW) rose by 116% on its first day, adding $3.75 billion in market value. That being said, the last company to leave as much value on the table during an IPO was Visa back in 2008 and its stock has continued to rise by more than 1,250% since then.