S&P 500 adds 3 companies without Tesla name, automaker’s stock decline

S&P 500 adds 3 companies without Tesla name, automaker's stock decline

Three new names will be added to the S&P 500 Index, but none of them are Tesla Inc.

The S&P Dow Jones Indices announced on Friday afternoon that it would add three companies to the S&P 500 SPX.
— Catalent Inc. CTLT,
, Etsy Inc. ETSY,
And Teradyne Inc TER,
Tesla Inc. TSLA,
+ 2.78%
It was thought to be added after releasing profitability for the fourth consecutive quarter, which is a requirement in the index cited by many observers, as the reason for the significant increase in the share price of electric vehicle companies in recent weeks.

Wedbush analyst Dan Ives said after Tesla reported a lucrative quarter in July, “Including the S&P 500 is likely a closed deal now.”

In an email to MarketWatch on Friday afternoon, Ives said, “This was a bit shocking and Street assumed this was an inevitable conclusion.” “It’s a head scratch that Tesla hasn’t been able to get into the S&P 500 club, and it’s likely that the stock will fall due to indexing effects.”

Tesla shares have added more than 31% since it released second-quarter earnings on the afternoon of July 22, but earnings fell this week. By the end of Monday’s trading session, the stock rose 56% after earnings. The stock split this week, announced plans to sell new shares of up to $5 billion, and sold insiders made stock prices difficult. Overall, the electric car company’s share price still five times this year, and its market capitalization rose to $380 billion based on Friday’s closing price.

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The previous three members of the S&P Midcap 400 moved to a larger index instead, and the other three companies that moved to the midcap index, H&R Block Inc. It replaces HRB.
+ 0.73%
, Coty Inc. COTY,
+ 6.31%
Kohl’s Corp. KSS,
+ 2.44%
Changes will take effect prior to trading commencement on September 21st.

Tesla shares fell more than 4% in after-hours trading right after the announcement. Catalent stocks increased by almost 4%, Etsy stocks increased by more than 4%, and Teradyne stocks increased by almost 3%.

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