Markus Andrews

The billionaire investor and founder of the Japanese tech-investing firm will also promise in the joint announcement with Trump to create 100,000 jobs focused on artificial intelligence and related infrastructure, the sources said.
The funding could come from various sources controlled by Softbank, including the Vision Fund, capital projects or chipmaker Arm Holdings, where the firm is majority owner.

President-elect Donald Trump and SoftBank Group Corp. founder and Chief Executive Officer Masayoshi Son speak to the media in the lobby of Trump Tower on December 6, 2016 in New York.
Eduardo Munoz Alvarez | AFP | Getty Images

Softbank CEO Masayoshi Son will announce a $100 billion investment in the U.S. over the next four years during a Monday visit to President-elect Donald Trump’s residence Mar-a-Lago in Palm Beach, Florida, sources familiar with the matter told CNBC’s Sara Eisen.
The billionaire investor and founder of the Japanese tech-investing firm will also promise in the joint announcement with Trump to create 100,000 jobs focused on artificial intelligence and related infrastructure, the sources said. The money will be deployed before the end of Trump’s term.

The funding could come from various sources controlled by Softbank, including the Vision Fund, capital projects or chipmaker Arm Holdings, where the firm is majority owner. Some of the money will not necessarily be newly raised, but could include some funding already announced such as Softbank’s recent $1.5 billion investment in OpenAI, the tech firm behind chatbot ChatGPT.
Softbank’s Son and Trump made a similar announcement in 2016 after Trump was elected president for the first time, with the Japanese firm agreeing to invest $50 billion in the U.S. with the aim to create 50,000 jobs. More

Retirees who receive income from public pensions may have their Social Security benefits reduced.
In November, the House of Representatives passed a bill by an overwhelming majority to nix those rules.
Now, the Senate has just days left in this session of Congress to vote on the proposal.

Cavan Images | Cavan | Getty Images

Last month, Congress moved to take rare bipartisan action to change certain Social Security rules.
The House of Representatives on Nov. 12 passed the Social Security Fairness Act by an overwhelming 327 to 75 majority.

The proposal would eliminate rules that reduce Social Security benefits for those who also receive income from public pensions, roughly around 2.8 million people.
For supporters of the bill, that legislative victory has been followed by a suspenseful wait. The Senate must also pass the proposal for it to become law. And the number of legislative days left in this session of Congress are quickly running out.
At a Wednesday rally on Capitol Hill, Senate Majority Leader Chuck Schumer, D-New York, promised to put the bill up for a vote.
“I am here to tell you the Senate is going to take action,” Schumer said, prompting cheers from the crowd including fire fighters, police, postal workers, teachers and other government employees, who stood outside the Capitol building in the rain.
“I got all my Democrats lined up to support it,” said Schumer, adding they need 15 Republicans.

“What’s happening to you is unfair, un-American,” Schumer said. “I will fight it all the way.”
Bette Marafino, an 86-year-old retired teacher and a member of a national grassroots task force that has pushed to have the rules eliminated, was at the Capitol when the House voted in November.
The vote prompted cheers that turned into tears of joy from the small group of advocates who witnessed it. “We were so happy,” Marafino said.
Now, she is worried what may happen if the Senate does not pass the bill by Dec. 20.
“It’s going to be start all over again, and we’ll need to have some champions,” Marafino said, now that Reps. Garret Graves, R-La., and Abigail Spanberger, D-Va., who co-led the bill, are leaving Congress.
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Prospect of nixing rules prompts fierce debate

Despite the enthusiasm from advocates behind the bill, many experts on both the left and right have said the Social Security Fairness Act is not the best policy.
The rules the bill would eliminate — the Windfall Elimination Provision, or WEP, and the Government Pension Offset, or GPO — were designed to make it so all Social Security beneficiaries received a comparable reimbursement for their contributions to the program.
Social Security is progressive, which means workers with lower lifetime earnings receive higher income replacement rates.
Without the rules, workers who are eligible for Social Security retirement benefits — and who also have income from pensions where they didn’t pay taxes into the program — may receive a higher income replacement than some workers who contributed to the program for their entire careers, experts argue.  
The bill also does not include a way to offset the cost of the benefit increases it includes.
Over 10 years, it would cost around $196 billion, according to the Congressional Budget Office. That’s as the program currently has just nine years before the trust fund it relies on to help pay retirement benefits may be depleted.
“As far as I know, there are no policy experts who support repealing the Windfall Elimination Provision and Government Pension Offset,” said Emerson Sprick, associate director of economic policy at the Bipartisan Policy Center.

The WEP affects about 2.1 million Social Security beneficiaries — or about 3% of all Social Security beneficiaries — who see their retirement or disability benefit checks reduced because they also receive pension benefits from jobs not covered by Social Security.
The GPO affects almost 746,000 individuals — about 1% of all Social Security beneficiaries — by reducing spousal or widow(er) benefits because of pensions from non-covered government employment.
Rather than eliminate the rules altogether, some experts have suggested it would make more sense to replace them with more precise formulas for adjusting benefits.
Yet groups like the International Association of Fire Fighters maintain eliminating the rules altogether is the best policy.
The starting salary for a firefighter in Louisiana is around $40,000, said Edward Kelly, general president of IAFF. To make ends meet, those professionals often take on second or third jobs, where they do pay Social Security payroll taxes. Yet once they become eligible for the program’s benefits, they have that income reduced.
Generally, workers who pay in the same amount as non-public employees can see their monthly benefits reduced by $500 or $600, Kelly said.
“That’s devastating and it’s patently unfair,” Kelly said. “You’re basically being discriminated against for your public service.”

Public workers say Social Security cuts hurt

For many public workers, the reduction of their Social Security benefits comes as a surprise.
Roger Boudreau, a 75-year-old former teacher who is on the executive board of the Alliance for Retired Americans, regularly received Social Security’s annual benefit statements with estimates of how much monthly income he may expect.
However, those disclosures did not include any information on the WEP or GPO penalties, he said.
Boudreau didn’t realize how much his monthly checks would be reduced until he went to sign up for his Social Security benefits 10 years ago.
It was a shock to find out his Social Security benefits would be cut by 40%, Boudreau said. He estimates has resulted in a loss of about $5,000 per year over the past decade.
Other public workers are forced to delay their retirements because of the way the rules affect them, according to Lois Carson, 64, president of the Ohio Association of Public School Employees, an affiliate of the American Federation of State, County & Municipal Employees.

Carson, who has been a Columbus City School employee for about 37 years, has delayed her own retirement since the rules limit the Social Security survivor benefits she would receive while collecting a pension.
“Most women work longer, because they can draw their husband’s Social Security while they’re working,” Carson said. “But once they retire, it drops down to a third.”
If the bill is not passed, most of the 30,000 members she represents will go way beyond their 30 years of employment, she said.
Advocacy groups have been working tirelessly to get lawmakers to move the bill.
Since the proposal passed in the House in November, Kelly said the firefighters alone have sent around 29,000 emails urging Senate leaders to pass the bill.
The stakes are high, experts say.
The initiative must compete with the Senate’s other legislative priorities. If the bill doesn’t get passed in this Congress, it dies, Kelly said.
With 62 Senate co-sponsors, the bill has a strong chance of passing once it is brought up for a vote.
“If it gets to a final vote under standard Senate procedure, I don’t see a whole lot of opportunity for it to fail,” Sprick said. “The question is whether it gets to that final vote.” More

Pavlo Gonchar | Lightrocket | Getty Images

Amid concerns over elevated valuations in the U.S. stock market, there are several stocks that continue to look attractive based on the future growth potential they promise.
To pick such stocks, investors can track the recommendations of Wall Street experts, who perform in-depth analysis to offer useful insights about a company’s strengths and growth opportunities.

Here are three stocks favored by the Street’s top pros, according to TipRanks, a platform that ranks analysts based on their past performance.

GitLab

We start this week with GitLab (GTLB), an artificial intelligence-powered company that offers software development tools. The company recently reported solid results for the third quarter of fiscal 2025 and raised its full-year outlook, citing demand for its end-to-end DevSecOps platform.
Following the Q3 print, BTIG analyst Gray Powell reiterated a buy rating on GTLB and boosted his price target to $86 from $63, saying the company’s Q3 revenue surpassed BTIG expectations by 4% and that operating income and earnings per share were significantly above estimates. He added that the magnitude of upside surprises in revenue has increased over the year, reflecting robust demand and market positioning.
Powell noted several positives, including strength in key metrics like remaining performance obligations (RPO), current RPO (CRPO) and net retention rate (NRR) and the rise in the take rates for the company’s Ultimate bundle. Those solid underlying metrics indicate that GitLab is well-positioned to maintain elevated growth rates in the future, he said. GitLab is also poised to gain from additional tailwinds, including new product offerings and rising customer seat counts, with hiring trends in software expected to improve next year.
Overall, GitLab’s enterprise value (EV)/sales multiple of 12.0x  (based on calendar year 2026 estimates) is “reasonable for a sustainable 25%+ growth story with rapidly improving operating and [free cash flow] margins and an upside bias to forecasts,” the analyst said.

Powell ranks No. 775 among more than 9,200 analysts tracked by TipRanks. His ratings have been profitable 57% of the time, delivering an average return of 10.5%. (See GitLab’s Insider Trading Activity on TipRanks) 

MongoDB

The next pick is MongoDB (MDB). The database software company crushed analysts’ expectations in its fiscal third quarter, thanks to solid demand for its Enterprise Advanced (EA) and Atlas offerings. But the stock fell as the COO and CFO Michael Gordon resigned effective at the end of its fiscal year on January 31, 2025.
In reaction to the impressive results, Needham analyst Mike Cikos reaffirmed a buy rating on MDB and raised the price target 24% to $415 from $335, highlighting that the EA offering was the primary driver of the Q3 revenue beat.
Cikos expects EA to continue to outperform investors’ expectations, thanks to MongoDB’s “run anywhere” strategy that enables organizations to deploy applications anywhere – across devices, on-premises data centers and the cloud.
Cikos added that while the Atlas offering was a smaller contributor to the top-line beat compared to EA, it outperformed Needham’s estimates, with Daily Atlas Consumption accelerating to 6.4% sequentially from 5.9% in the prior quarter. Further, the analyst noted the company’s decision to reallocate certain mid-market investments to prioritize the Enterprise segment. Cikos added that this move matched other software vendors in his coverage universe, reflecting their efforts to evolve best sales practices in the current macroeconomic backdrop.
Cikos ranks No. 511 among more than 9,200 analysts tracked by TipRanks. His ratings have been profitable 59% of the time, delivering an average return of 15.2%. (See MongoDB Stock Charts on TipRanks) 

SentinelOne

Finally, let’s look at SentinelOne (S), an AI-powered cybersecurity company. Earlier this month, the company reported better-than-expected revenue for the third quarter of fiscal 2025. However, its loss per share widened due to higher operating expenses.
Recently, TD Cowen analyst Shaul Eyal reaffirmed a buy rating on SentinelOne stock with a price target of $35. The analyst believes in the company’s ability to continuously disrupt and win share in the $7 billion legacy antivirus (AV) market.
Calling SentinelOne one of his best ideas for 2025, Eyal thinks that “key ingredients are at hand to make an exciting cocktail” and drive a reacceleration in annual recurring revenue and revenue in fiscal 2026. The key drivers cited were increasing win rates, positive new logo trends and a continuously rising share of clients’ spending.
Additionally, Eyal expects SentinelOne’s partnership with PC maker Lenovo to enhance its medium-term branding, though it might not have any material impact on near-term performance. The revenue outlook for the first quarter and full year of fiscal 2026 are likely to prove the next major catalyst for the stock, determining how significantly the company can capitalize on recent woes at rival CrowdStrike.
Eyal ranks No. 8 among more than 9,200 analysts tracked by TipRanks. His ratings have been profitable 71% of the time, delivering an average return of 27%. (See SentinelOne Ownership Structure on TipRanks)  More

There’s tax uncertainty heading into 2025 as Congress grapples with trillions in expiring tax cuts enacted by President-elect Donald Trump in 2017.
Next year, Republican lawmakers plan to address these expirations through a process known as “reconciliation,” which bypasses the filibuster.
Pending legislation makes tax planning more difficult. But there are lessons from Trump’s first tax package, experts say.

President Donald J. Trump signs the Tax Cut and Reform Bill in the Oval Office at The White House in Washington, DC on December 22, 2017.
Brendan Smialowski | AFP via Getty Images

There’s tax uncertainty heading into 2025 as Congress prepares to negotiate President-elect Donald Trump’s economic agenda.
But there could be lessons for investors from his signature tax overhaul in 2017, financial experts say.  

During his campaign, Trump vowed to fully extend the trillions in tax breaks he enacted via the Tax Cuts and Jobs Act, or TCJA, in 2017, which brought sweeping changes for individuals and businesses.  
He also called for new policies, like no tax on tips, ending taxes on Social Security benefits for older adults and eliminating the $10,000 cap on the deduction for state and local taxes, known as SALT, among others. 
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While Republicans largely back Trump’s agenda, no one knows which proposals will prevail, particularly amid concerns over the federal budget deficit. That makes planning for tax changes more challenging.
Still, there are things to learn from Trump’s 2017 tax package, experts say.

Last-minute tax strategies

Without action from Congress, trillions of tax breaks enacted via the TCJA will expire after 2025, including lower tax brackets, bigger standard deductions, a more generous child tax credit and a higher estate and gift tax exemption, among other provisions.   
But after securing the trifecta — control of the White House, Senate and House of Representatives — Republican lawmakers plan to address these expirations through a process known as “reconciliation,” which bypasses the filibuster.
Republicans used the same strategy to enact the TCJA in late December 2017.

Before the law’s effective date on Jan. 1, 2018, some investors used last-minute strategies, like “accelerating itemized deductions,” by prepaying property taxes and state income taxes, according to certified public accountant Duncan Campbell, who leads Baker Tilly’s private wealth practice.
The move was popular among top earners in high-tax states, like California, New Jersey and New York. Those individuals would soon be limited to $10,000 federal deduction for SALT, which includes property and state income taxes.

‘Be ready and positioned’ for changes

With several pending tax law provisions, many advisors urge clients to avoid irreversible tax plan changes until final legislation is signed into law. 
“My preference is always to go with what we know will be true versus what could be true in the future,” said Ryan Losi, a certified public accountant and executive vice president of CPA firm Piascik.

My preference is always to go with what we know will be true versus what could be true in the future.

Executive vice president of Piascik

Over the past year, Losi urged clients above the estate and gift tax exemption to meet with an attorney to discuss plans to reduce taxable estates if Congress doesn’t extend the higher limits after 2025. 
In 2025, the basic exclusion amount will rise to $13.99 million per person, which applies to tax-free wealth transfers during life and at death. If it expires, the exclusion will revert to 2017 levels, adjusted for inflation.    
“You want to be ready and positioned” to finalize estate planning documents if Congress doesn’t extend the bigger exemptions, he said.
While extending the higher estate tax exemption could be more likely under a Republican-controlled Congress, there were several 11th-hour changes back in 2017.
“There could be another Trump Christmas present that no one expected,” Losi said.

Expect ‘uncertainty’ if legislation passes

Enacted late in December 2017, the TCJA left advisors with little time to analyze changes before Jan. 1, 2018, said Campbell with Baker Tilly. 
Plus, “there was a little bit of an uncertainty at that point,” about several newly enacted provisions, he said.
For example, there was confusion about the multi-step calculation for the so-called qualified business income deduction, worth up to 20% of eligible revenue for pass-through businesses, Campbell said.
Tax professionals often have lingering questions after Congress passes legislation. The specifics may be later addressed by IRS guidance.  More

Timon Schneider | SOPA Images | AP

Company: Markel Group (MKL)

Business: Markel Group is a holding company comprised of different businesses and investments. Its segments include Specialty Insurance, Investing and Markel Ventures. The Specialty Insurance segment includes the company’s insurance and reinsurance capacities within its underwriting operations, as well as insurance-linked securities and all treaty reinsurance written on a risk-bearing basis. The Investing segment includes all investing activities related to Markel’s insurance operations and asset portfolio of fixed maturities, equities, short-term assets and cash equivalents. The Markel Ventures segment consists of controlling interests in a diverse portfolio of businesses that operate in various industries.
Stock Market Value: $22.33B ($1,735.79 per share)

Stock chart icon

Markel Group in 2024

Activist: Jana Partners

Ownership: n/a
Average Cost: n/a
Activist Commentary: Jana is a very experienced activist investor founded in 2001 by Barry Rosenstein. The firm made its name by taking deeply researched activist positions with well-conceived plans for long term value. Rosenstein called his activist strategy “V cubed.” The three “Vs” were” (i) Value: buying at the right price; (ii) Votes: knowing whether you have the votes before commencing a proxy fight; and (iii) Variety of ways to win: having more than one strategy to enhance value and exit an investment. Since 2008, the firm has gradually shifted that strategy to one which we characterize as the three “Ss” (i) Stock price – buying at the right price; (ii) Strategic activism – sale of company or spinoff of a business; and (iii) Star advisors/nominees – aligning with top industry executives to advise them and take board seats if necessary.

What’s happening

Jana called on Markel to improve its insurance operations and explore a separation or sale of its private investments business. The firm also noted that the entire company presents an attractive acquisition target for larger insurers.

Behind the scenes

Markel Group is a financial holding company with a core business of specialty insurance. The capital base provided by the premiums from its underwriting business has enabled the company to fund its other two business segments: Investments and Markel Ventures. Its investing segment encompasses a $30 billion portfolio of fixed maturity securities, equity securities and short-term investments. Markel Ventures, a private equity-like business, owns controlling stakes in a diverse portfolio of businesses ranging from building supplies to bakery equipment and luxury handbags. Given its business model of reinvesting premiums to fund investment activities, Markel has been likened to Berkshire Hathaway.

Specialty insurers have enjoyed a very robust and hard market (i.e., rising premiums and reduced capacity) for several years. However, Markel has experienced a protracted period of underperformance relative to its peers. On a one-, three- and five-year basis, Markel has returned 25.6%, 41.5% and 56.2%, which stands in stark contrast to its peers which have returned an average of 28.0%, 85.4% and 162.3%. It has also underperformed the Dow Jones U.S. Property and Casualty Insurance Index over each of these periods.
When looking for the source of its underperformance, the first place to always look is the core business, which has experienced capital allocation and operational issues. On capital allocation, Markel Group has engaged in some value-destructive M&A. In 2018, Markel Corp purchased Nephila, an investment manager specializing in reinsurance risk for $975 million. In December 2018, Nephila had $11.6 billion in net assets under management. Today, it stands at $7 billion. Operationally, management has had some underwriting challenges that have led to under-reserving in recent years after many years of over-reserving. This not only causes management to have to increase the reserve as opposed to releasing surplus reserve, but it also spooks the market a little as insurance company investors may fear future liabilities not presently accounted for. As a result, the company’s combined ratio (a measure of profitability for insurance companies) has been higher than peers for several years. The combined ratio is calculated by dividing the sum of the company’s underwriting expenses and incurred losses by its earned premium. The higher the ratio, the lower the profitability. Markel’s combined ratio was 96.4% in its most recent quarter, 98.4% last year and in the nineties for several years. This compares to peers’ average in the mid-eighties, with some even in the high seventies.
While fixing the core business is always the first step, even with an improved and efficient insurance business, Markel would still have a valuation overhang in the form of its Ventures business. Of the company’s three engines (Insurance, Investments and Ventures) this is the one that makes the least sense. It is also unique to Markel among its peers and is the hardest for the market and investors to value. Monetizing this business could be the best opportunity to create value.
Jana is urging the board and management to improve the core insurance business and reduce its combined ratio through better underwriting rigor, more disciplined expense management and a more opportunistically targeted selection and focus on insurance lines and markets. If management can improve performance in its core business, it should result in a re-rating of the business. Second, Jana is recommending that management explore a divestiture of the Ventures business, which has been deflating Markel’s valuation. The company trades at 1.3 times book value versus peers that trade at an average of 2.5 times. Moreover, the last time Markel traded at 2.5 times book value was before it launched its Ventures business. Through its Ventures arm, Markel owns controlling interests in a Boston-based luxury handbag company, a boutique house plant operation, a bakery equipment manufacturer, a homebuilder and 16 other businesses that a specialty insurance company has no real expertise in. It would be great for the company to sell this business either in whole or by selling individual businesses at the 8 times EBITDA multiple it bought them for. This would not only give Markel cash to use in its business or return to shareholders, but it would also give investors more confidence and certainty in the company’s business lines.
Finally, while not outright calling for a sale of the company, Jana acknowledges that the company could be a strategic asset for other larger specialty insurers, such as Tokio Marine, Zurich Insurance Group and Arch Capital. If this opportunity arises, as fiduciaries and economic animals, Jana will ensure that the board weighs this opportunity versus the risk-adjusted return of a standalone plan to maximize long-term value for shareholders.
There is no reason to believe that Jana and management are not on the same page here. Certainly, the parties agree that the company is undervalued and are incentivized to increase the stock price. Not only has Jana been a buyer of the stock, but the board recently authorized a $2 billion share buyback, and the CEO has personally been buying shares. Jana has some time to figure out its next move: The director nomination window does not open until Jan. 22, 2025, and closes on Feb. 21, 2025. However, we do not expect this engagement will lead to a nomination of directors by Jana.
This is the first new activist campaign since we launched the 13D Monitor Company Vulnerability Ratings (“13DM CVR”). Of the more than 2,500 companies we rated, Markel fell in the sixth percentile of companies most likely to be engaged by an activist.
Ken Squire is the founder and president of 13D Monitor, an institutional research service on shareholder activism, and the founder and portfolio manager of the 13D Activist Fund, a mutual fund that invests in a portfolio of activist 13D investments. More

Exxon Mobil and Chevron are jumping into the race to power AI data centers.
Exxon plans to build a natural gas plant to power a data center and use carbon capture technology to slash the plant’s emissions.
Exxon CEO Darren Woods said decarbonized natural gas plants are a quicker solution to the tech industry’s power needs than nuclear.

Budrul Chukrut | Lightrocket | Getty Images

Exxon Mobil and Chevron are jumping into the race to power artificial intelligence data centers, as the two oil majors bet tech companies will ultimately turn to natural gas to meet their tremendous energy needs.
Exxon unveiled plans this week to build a natural gas plant to power a data center. The oil major says it would then use carbon capture and storage technology to reduce the emissions of the plant by 90%.

“We’re working with other large cap industrials to rapidly deploy a solution that would provide both high reliability and low carbon intensity power to meet the growing demand for computing power for artificial intelligence,” Exxon Chief Financial Officer Kathryn Mikells told Wall Street analysts Wednesday without disclosing names of the companies’ the oil major is working with on the project.
The gas plant would not rely on the electric grid and would be independent of utilities, allowing faster installation than traditional power generation projects, Mikells said. Exxon has not disclosed a customer or a timeline for the project.
Exxon has invested heavily in building a carbon capture network along the Gulf Coast with more than 900 miles of pipeline to transport CO2 from several industrial customers to permanent storage sites. The oil major estimates decarbonizing AI data centers could represent up to 20% of its total addressable market for carbon capture and storage by 2050.
Chevron is also working on ways to power data centers, said Jeff Gustavson, president of the oil company’s new energy business, at the Reuters NEXT conference on Wednesday.
“This is something that our company is very well positioned to participate in,” Gustavson said. Chevron is a major national gas producer with power generation equipment and very large tracts of land that could be used for data centers, the executive said.

Gas over nuclear

Alphabet, Amazon, Microsoft and Meta have primarily bought wind and solar power for their data centers as they seek to mitigate the impact of their businesses on the climate. But the power needs of artificial intelligence are growing so large that the tech companies are searching for sources of electricity that are more reliable than renewable energy.
The tech companies have shown a growing interest in nuclear power as a consequence. Microsoft is helping to bring the Three Mile Island nuclear reactor back online by purchasing power from the plant. Amazon and Alphabet’s Google unit are investing in next-generation, small nuclear reactors. Meta recently called on companies to send it proposals to build new nuclear plants.
But the fossil fuel industry and energy analysts have argued for months that the tech sector will ultimately have to embrace natural gas because nuclear plants simply take too long to build.
Exxon CEO Darren Woods took a swipe at nuclear power Wednesday and claimed his company is better positioned than any in the U.S. to meet the power needs of AI in the immediate and near term.
“If you’re betting on nuclear and something coming down the road, there’s a long road ahead of us,” Woods told Wall Street analysts on Wednesday. The small nuclear reactors that tech companies are investing are not expected to reach commercialization until the 2030s.
Exxon is not looking to start a power generation business, the CEO said. The company plans use its expertise leading large projects to help install power generation for data centers in the early stages of the AI ramp up, Woods said.
Once the early ramp up is done, Exxon will focus on trapping and storing emissions associated with data centers, and supplying decarbonized natural gas to the power plants that run AI, Woods said.

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MicroStrategy, which has become a play on bitcoin, will be joining the Nasdaq 100 index, effective Dec. 23.
Exchange-traded funds that follow the index – including the popular Invesco QQQ Trust – will become automatic buyers of the stock.
Shares of MicroStrategy have soared more than 500% in 2024.

MicroStrategy founder Michael Saylor speaks at the Bitcoin 2021 Conference in Miami on June 4, 2021.
CFOTO | Nurphoto | Getty Images

MicroStrategy, the preferred high beta play on the price of bitcoin, will join the Nasdaq 100 index, a move that could further increase demand for the controversial stock that has been on a torrid run this year alongside the price of the cryptocurrency.
The Nasdaq 100 comprises 100 of the largest nonfinancial companies in the tech-focused Nasdaq Composite index. A stock’s addition means that ETFs – including the highly popular Invesco QQQ Trust, which has $325 billion in assets – will become automatic buyers as well.

Shares of the bitcoin proxy could be set to gain off the move. They’re up more than sixfold this year, compared with bitcoin’s nearly 140% gain in the same period.
The change, which will become effective before the market open on Dec. 23, was announced Friday after the stock market close. MicroStrategy was widely telegraphed as a potential contender for membership by investors who were looking forward to the index’s rebalancing this week.
“This would lead to inclusion of MSTR in some of the largest ETFs such as QQQ (5th largest ETF) etc, leading to one-time fresh buying … and ongoing participation in future inflows,” said Gautam Chhugani, an analyst at Bernstein, in a note this week ahead of the reshuffle.
Additionally, “the market will likely set its sight on S&P 500 inclusion for 2025,” Chhugani said. “Currently, due to profitability of its software business, it may be challenging to be considered for S&P 500 inclusion.”
The Nasdaq changes the constitution of the Nasdaq 100 index annually. The companies selected for inclusion are based largely on market cap rankings on the last trading day of November, which was Nov. 29 this year. Stocks must also meet eligibility requirements around liquidity and the free float percentage of their shares.

MicroStrategy originally sold enterprise software, but the firm has increasingly become a bitcoin holding company. It first added bitcoin to its balance sheet in 2020, with Michael Saylor as CEO at the time, and has been leaning into that strategy in the years since. MicroStrategy now issues convertible notes to leverage its purchases, and its stock’s daily trading sometimes looks like a more volatile version of bitcoin.
The company now has a market cap of roughly $90 billion despite having less than $500 million in revenue over its previous four quarters, according to FactSet. Saylor told CNBC’s “Squawk Box” earlier this month that he sees the company’s role as “securitizing bitcoin.”
“Primarily, our job is to bridge the traditional capital markets that want bonds, or they want fixed income, or they want equity, or they want options, and we plug that into the crypto economy. And we use bitcoin as the vehicle to do that,” said Saylor, who is now the company’s executive chairman.
MicroStrategy began cranking up its purchases after the U.S. presidential election. The victory of pro-crypto President-elect Donald Trump — specifically his promise to establish a national strategic bitcoin stockpile — has propelled bitcoin to new all-time highs, achieved in part by the company’s purchases. MicroStrategy now owns 423,650 bitcoins. It bought 149,880 of them in four different purchases over the past month, beginning Nov. 11.
As part of MicroStrategy’s hot streak this year, activists have been pushing bitcoin investing as an agenda item in shareholder meetings at companies like Microsoft and Amazon. Mining stocks like Mara Holdings have also begun employing Saylor’s bitcoin yield strategy.
Palantir Technologies and Axon Enterprise will also be joining the Nasdaq 100 later this month. Illumina, Moderna and Super Micro Computer will be removed from the index.
Last year, the Nasdaq 100 added six companies in its annual reconstitution, including DoorDash. Five of those six stocks rose the Monday after the announcement, with an average move of 1.21%.
—With reporting by Jesse Pound.

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If you’re considering a Roth individual retirement account conversion, your tax bracket could help you decide whether the move makes sense.
Before completing the transfer, you need to know how long it will take to break even on upfront taxes, based on your long-term goals.
You should also weigh other financial planning opportunities in lower-income years, experts say.

Eleganza | E+ | Getty Images

The best tax brackets for Roth conversions

When crunching the numbers for a Roth conversion, you’ll want to consider how the transfer impacts your current tax bracket, according to Tommy Lucas, a certified financial planner and enrolled agent at Moisand Fitzgerald Tamayo in Orlando, Florida.
If you can stay within the 12% tax bracket or lower, “that’s a no-brainer, 99% of the time,” he said. But anything above the 12% is “situational,” depending on a client’s goals and other factors. 

Ryan Losi, a certified public accountant and executive vice president of CPA firm Piascik, also uses a “rule of thumb” to greenlight Roth conversions.
“If we can convert and still stay in the 24% bracket or lower, I’m a thumbs up,” he said. But bumping into the 32% bracket or higher prolongs the “recovery period” to recoup upfront taxes. 
Of course, these benchmarks can change depending on a client’s unique circumstances, such as estate planning goals, experts say. 

Weigh rebalancing in lower-income years

When completing a Roth conversion, advisors typically aim to fill a specific tax bracket with income without spilling into the next one.
But you could miss other planning opportunities by focusing solely on Roth conversions, Lucas said.
For example, if you’re sitting on a large brokerage account with sizable gains, you could leverage your lower tax brackets to rebalance your portfolio, he said.
The strategy, known as “tax gain harvesting” involves strategically selling profitable assets during lower-income years.
For 2024, you may qualify for the 0% long-term capital gains rate with a taxable income of up to $47,025 if you’re a single filer or up to $94,050 for married couples filing jointly. 
These figures would include assets sold from your brokerage account. More