The United States House of Representatives passed the SAVE Act (Safeguard American Voter Eligibility) by a 220 to 208 vote — and Palantir stock (NASDAQ: PLTR) could be set to benefit from the bill.
Although quite controversial and still in an early stage of the legislative pipeline, the measure would require presenting documents to prove citizenship when registering to vote in a federal election.
Moreover, the bill authorizes election officials to cross-reference data from the Social Security Administration (SSA), Department of Homeland Security (DHS), and U.S. Citizenship and Immigration Services (USCIS) to confirm citizenship status, while also directing federal agencies to work with election officials to that end.
In addition, the SAVE Act mandates regular audits of voter rolls by both federal and state officials, which would be reported to Congress.
Palantir is perhaps the best-positioned business to benefit from the new bill
Everything that we’ve mentioned is right up the Alex Karp-led data analytics venture’s alley.
Although exact funding hasn’t been allocated, with the new requirements mandated by the bill, a sweeping upgrade of states’ IT systems, databases, and the processes necessary to enforce the new law could provide Palantir with a bevy of new government contracts.
The fact that the funding hasn’t been allocated isn’t necessarily an obstacle, as there’s a distinct possibility that counties and states will have to foot the bill, which the Institute for Responsive Government has pegged at roughly $400 million.
Unfortunately for Palantir bulls, the SAVE Act is still far from a done deal
On the other hand, there are a wide variety of issues that could lead to either significant changes in the bill, or it not being adopted at all.
For one, it is now headed to the Senate — where the Republicans will need to secure four votes from the Democrats to successfully pass the SAVE Act into law. Then, it could be rewritten, amended, watered down, or simply fizzle out in the legislative pipeline.
Although too complex to properly cover here, the stipulations of the bill, which could potentially disenfranchise millions of United States citizens, are enormously controversial, as highlighted by the Lawyers’ Committee for Civil Rights Under Law and the Center for American Progress.
Lastly, it’s important to consider recent price action, as well as fundamentals. At press time on April 11, Palantir stock was changing hands at a price of $87.70. PLTR shares are still up by 15.96% on a year-to-date (YTD).
However, after reaching an all-time high (ATH) of $124.62 on February 18, the stock crashed below $100 — and has failed to cross this threshold since. PLTR remains one of the most overvalued stocks in the S&P 500, and although it is largely tariff-proof and immune to trade war complications, in the event of an economic slowdown or recession, it would be among the first equities on the chopping block.
Featured image via Shutterstock
