(Bloomberg) — KKR & Co. Inc., CrowdStrike Holdings, Inc. and GoDaddy Inc. will join the S&P 500 in its latest quarterly weighting change.
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The companies will replace Robert Half Inc., Comerica Inc. and Illumina Inc, according to an S&P Dow Jones Indices press release Friday. The changes are expected to come into effect before markets open on Monday, June 24.
The inclusion of New York-based KKR highlights the massive growth of the private investment sector in recent years. KKR, founded in 1976 by Henry Kravis, Jerome Kohlberg and George Roberts, recently outlined a plan to reach at least $1 trillion in assets under management within five years, in part by courting retirees and individuals . Famous for its private equity activities, the firm has expanded into strategies ranging from buyouts and credit to infrastructure, real estate and insurance.
KKR shares rose 6.5% after hours.
Meanwhile, the additions of CrowdStrike and GoDaddy come as stock investors flock to software companies in a bid to capture growth in cloud computing and artificial intelligence.
Shares of cybersecurity company CrowdStrike rose 9% after hours. The stock has more than doubled over the past year to become the second-best performer on the tech-heavy Nasdaq 100 index, trailing only Nvidia Corp.
On Tuesday, CrowdStrike reported first-quarter results that beat Wall Street expectations, despite a spending decline that strained its cybersecurity rivals.
Shares of web platform company GoDaddy gained about 30% through Friday’s close. Shares rose 4% after hours Friday.
To be eligible for the S&P 500, companies must be highly liquid U.S. companies with a market capitalization of at least $18 billion and meet standards for profitability, liquidity and free float. According to the May methodology, the thresholds for the S&P MidCap 400 Index and the S&P SmallCap 600 Index are $6.7 billion to $18.0 billion and $1.0 billion to $6.7, respectively. billions of dollars.
Benchmark inclusion is becoming increasingly important for companies in a world increasingly dominated by passive investment funds. Additionally, a spot in the coveted S&P 500 strengthens a company’s investor profile and adds trading liquidity – factors that can potentially propel its stock price higher.
Exclusion from the benchmark may weigh on stock prices, as passive investors are forced to sell their shares and realign with the new composition of the S&P 500.
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