Palantir, Dell, and Erie Indemnity to Join S&P 500

Ahead of trading on September 23, the S&P Dow Jones Indices announced major shifts across its indices, with changes impacting the S&P 500, S&P MidCap 400, and S&P SmallCap 600.

What changes are coming to the S&P 500 in the quarterly update?

Palantir Technologies (NYSE: PLTR), Dell Technologies (NYSE: DELL), and Erie Indemnity (NASDAQ: ERIE) are set to join the prestigious S&P 500, replacing American Airlines (NASDAQ: AAL), Etsy (NASDAQ: ETSY), and Bio-Rad Laboratories (NYSE: BIO). This upgrade for Palantir, Dell, and Erie reflects their growing market influence and performance, positioning them as prominent players among large-cap U.S. companies.

For American Airlines, Etsy, and Bio-Rad, their removal from the S&P 500 signals a shift in investor perception and market performance. Each will now find a new home in different indices, making way for the incoming companies.

The S&P 500 represents the 500 largest companies in the U.S. by market capitalization. These are typically well-established, large companies.

How will the latest changes affect the S&P MidCap 400?

American Airlines will transition to the S&P MidCap 400, replacing TEGNA Inc. (NYSE: TGNA). Similarly, Bio-Rad Laboratories will join the S&P MidCap 400, taking the spot of Erie Indemnity as it moves to the S&P 500. Additional entrants to the S&P MidCap 400 include CNH Industrial (NYSE: CNH), Western Alliance Bancorp (NYSE: WAL), Parsons Corp. (NYSE: PSN), Hamilton Lane Inc. (NASDAQ: HLNE), Viper Energy (NASDAQ: VNOM), and Fabrinet (NYSE: FN). These companies will replace MP Materials (NYSE: MP), Progyny (NASDAQ: PGNY), Adient (NYSE: ADNT), Wolfspeed (NYSE: WOLF), Helen of Troy Ltd (NASDAQ: HELE), and Ziff Davis (NASDAQ: ZD), which will all move to the S&P SmallCap 600.

The S&P MidCap 400 includes 400 companies with mid-sized market capitalizations. These companies are smaller than those in the S&P 500 but larger than those in the SmallCap 600.

How will the latest changes impact the S&P SmallCap 600?

The S&P SmallCap 600 will see significant restructuring as companies from the S&P MidCap 400 trickle down and make room for new entrants. Companies such as TEGNA, Etsy, Ziff Davis, MP Materials, and Progyny are being moved to this index, replacing underperformers such as Designer Brands Inc. (NYSE: DBI), Calavo Growers (NASDAQ: CVGW), Enhabit Inc. (NYSE: EHAB), Mercer International (NASDAQ: MERC), Compass Minerals International (NYSE: CMP), 3D Systems Corp. (NYSE: DDD), and Fabrinet.

Other companies joining the SmallCap 600 include Zurn Elkay Water Solutions (NYSE: ZWS), Clear Secure (NYSE: YOU), TG Therapeutics (NASDAQ: TGTX), Inspire Medical Systems (NYSE: INSP), CSW Industrials (NASDAQ: CSWI), ADMA Biologics (NASDAQ: ADMA), and Impinj (NASDAQ: PI). These companies will take the place of outgoing constituents such as Community Healthcare Trust (NYSE: CHCT), Varex Imaging (NASDAQ: VREX), Dine Brands Global (NYSE: DIN), and AMC Networks (NASDAQ: AMCX).

The S&P SmallCap 600 tracks 600 smaller U.S. companies with lower market capitalizations. These companies are often in growth stages.

How will the changes impact Investors?

These index changes highlight the evolving nature of the market, with companies being rewarded or penalized based on performance, growth potential, and investor sentiment. For investors, adding Palantir, Dell, and Erie Indemnity to the S&P 500 could increase visibility and investment interest. Likewise, movements in the MidCap and SmallCap indices offer opportunities for those tracking smaller, emerging companies.

These updates provide a clearer picture of market shifts and trends, offering valuable insights into which companies are gaining traction and which are losing ground.