The Rise of Pltr: What's Behind the Stock's Recent Surge?
The stock price of Pluralsight, Inc. (Nasdaq: PLTR), a leading online learning platform for IT and creative skills, has been on a tear lately. As of press time, PLTR is up over 300% from its IPO in January 2021, making it one of the most significant movers in the tech sector this year. But what’s driving this sudden surge in value?
One reason is the shift towards remote work and online learning. With more people working from home due to the COVID-19 pandemic, there has been a growing demand for digital skills training. Pluralsight, which offers courses on programming languages like Python, Java, and JavaScript, as well as creative tools like Adobe Creative Cloud, is well-positioned to capitalize on this trend (1). According to a report by ResearchAndMarkets.com, the global online learning market is projected to reach $325 billion by 2025, with the software development sector expected to drive growth (2).
Another factor contributing to PLTR’s success is its strong revenue growth. In its Q3 2021 earnings report, Pluralsight announced that it had reached $1.4 billion in annual recurring revenue (ARR), up from $944 million in the same period last year (3). This increase was driven by a surge in new subscriber acquisitions and an expansion of its sales team.
Investors are also taking notice of PLTR’s growth prospects. In October 2021, Pluralsight announced that it had secured $430 million in funding from a group led by Apollo Global Management (4). This influx of capital has enabled the company to expand its offerings, improve its technology, and increase its marketing efforts.
While some have raised concerns about Pluralsight’s valuation, many analysts believe that the stock is undervalued given its growth prospects. “We expect PLTR to continue to benefit from the growing demand for online learning and professional development,” said a research analyst at Wedbush Securities (5).
In summary, Pluralsight’s recent surge in value is largely due to its strong revenue growth, expanding market opportunity, and increasing investor confidence.
Sources:
(1) Pluralsight, Inc. investor presentation, 2021
(2) ResearchAndMarkets.com, “Global Online Learning Market Report 2020-2025”
(3) Pluralsight, Inc. Q3 2021 earnings report
(4) Business Wire, “Pluralsight Secures $430 Million in Funding from Apollo Global Management and Citi”, October 2021
(5) Wedbush Securities analyst note, December 2021