KKR & Co. Inc., CrowdStrike Holdings, Inc. and GoDaddy Inc. will probably be added to the S&P 500 as a part of the newest quarterly weighting change.
The firms will replace Robert Half Inc., Comerica Inc. and Illumina Inc., S&P Dow Jones Indices said in a press release Friday. The changes are expected to take effect before the beginning of trading on Monday, June 24.
The addition of New York-based KKR underscores the large growth of the private investment business lately. KKR, founded in 1976 by Henry Kravis, Jerome Kohlberg and George Roberts, recently laid out a plan to succeed in a minimum of $1 trillion in assets under management in five years, partially by recruiting retirees and individuals. The firm, known for its private equity activities, has expanded its strategies from acquisitions and credit to infrastructure, real estate and insurance.
KKR shares rose 6.5 percent in after-hours trading.
Meanwhile, the additions of CrowdStrike and GoDaddy come at a time when investors are flocking to software firms to capitalize on the expansion of cloud computing and artificial intelligence.
Shares of cybersecurity company CrowdStrike rose 9% in after-hours trading. The stock has greater than doubled in value over the past 12 months and is now the second-best performer within the tech-heavy Nasdaq 100 index, surpassed only by Nvidia Corp.
On Tuesday, CrowdStrike delivered First-quarter earnings beat Wall Street expectations despite a spending decline that challenged cybersecurity rivals.
Shares in web platform company GoDaddy rose by around 30 percent by the close of trading on Friday. In after-hours trading on Friday, shares rose by 4 percent.
To qualify for the S&P 500, firms have to be highly liquid U.S. firms with a market capitalization of a minimum of $18 billion and meet standards for profitability, liquidity and share ownership. methodologyThe thresholds for the S&P MidCap 400 Index and the S&P SmallCap 600 Index are between $6.7 billion and $18.0 billion, and between $1.0 billion and $6.7 billion, respectively.
In a world increasingly dominated by passive mutual funds, benchmark inclusion is becoming increasingly necessary for firms. In addition, a spot within the coveted S&P 500 strengthens an organization’s investor profile and increases trading liquidity – aspects that may potentially drive up the share price.
Exclusion from the benchmark index can weigh on share prices as passive investors are forced to sell the shares and align with the brand new composition of the S&P 500.
