📰 S&P Inclusion Announced Today: These Stocks Are Most Likely to Be Added

With the S&P 500 rebalance announcement tonight, we explore the top candidates for inclusion, the potential removals, and the market impact of these changes.

At 5:15 PM ET tonight, the S&P 500 will announce the results of its quarterly March rebalance, making it a highly anticipated moment for both investors and companies. With numerous potential candidates for inclusion, today’s announcement could bring significant changes to the index. Companies added to the S&P 500 often see a boost in stock performance, while those removed face the challenge of recalibrating their market positioning.

Potential candidates

Barclays has identified a number of companies as prime candidates for inclusion in the S&P 500. These companies have demonstrated strong financial performance and growth potential, making them likely to be added to the index:

• Ares Management
  A leading global alternative asset manager with strong growth potential.

• Coinbase
  As one of the largest cryptocurrency exchanges, Coinbase has gained significant attention in the past year.

• Robinhood
  A popular stock-trading app, Robinhood has revolutionized retail investing and could be poised for inclusion.

• Interactive Brokers
  A major online brokerage firm with a global presence and solid financial results.

• LPL Financial
  A leading retail investment advisory firm, showing strong growth in wealth management services.

• Blue Owl Capital
  A private equity and real estate investment firm, experiencing significant growth in the investment management space.

• Tradeweb Markets
  A leading operator of electronic marketplaces for fixed income, derivatives, and ETFs, Tradeweb has seen a steady rise in market share.

Other noteworthy candidates include AppLovin, Trade Desk, Datadog, DoorDash and Block, all of which have seen rapid growth in recent years and could potentially meet the criteria for S&P 500 inclusion.

Criteria for S&P 500 inclusion

To be qualified for inclusion in the S&P 500, companies must meet certain requirements:

1. Market capitalization: The company must have a market capitalization of at least $13.1 billion.

2. Liquidity: The stock must be highly liquid, with sufficient daily trading volume.

3. Financial viability: The company must have positive earnings in the most recent quarter, as well as over the most recent four quarters.

4. U.S. based: The company must be incorporated in the U.S. and have a significant portion of its business operations within the U.S.

These criteria ensure that only stable, financially healthy companies with strong market positions are included in the prestigious index.

Candidates for exclusion

While some companies are hoping for inclusion, others are at risk of being removed. Two companies that are under the microscope for potential exclusion from the S&P 500 are Intel and Walgreens Boots Alliance.

• Intel
  Once a leader in the semiconductor industry, Intel has struggled with competition and internal challenges, which have hindered its stock performance and market position.

• Walgreens Boots Alliance
  With the retail pharmacy space facing pressure, Walgreens has experienced declining sales and profitability, putting its inclusion in the S&P 500 at risk.

Impact of S&P 500 inclusion

The inclusion of a company in the S&P 500 often leads to a significant boost in stock performance. On average, stocks that are added to the index experience a 7% gain on the first day of trading. This is because the addition to the S&P 500 usually triggers a wave of buying by institutional investors who track the index, leading to higher demand for the stock.

This makes tonight’s announcement a potential catalyst for the selected companies, who could see their stock prices surge following the announcement. As the market waits for the results, all eyes will be on which companies make the cut and how their stocks will react in the coming days.

Source: TipRanks, Business Insider

Disclaimer:
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