Twitter About to Be Even More Ubiquitous With S&P 500 Add
Twitter was a stock market swamp for 3 years after going public. It took a step toward putting that era behind it.
(Bloomberg) -- Twitter Inc. was a stock market swamp for three years after going public, saddling investors with as much as $32 billion in equity losses. It took another step Monday toward putting that era behind it.
In an action that forces index funds with trillions of dollars in assets to own it, the social media company will replace Monsanto Co. in the S&P 500 prior to the start of trading June 7. A much larger internet rags-to-riches story, Netflix Inc., was added to the S&P 100, S&P Dow Jones Indices said.
Twitter’s 58 percent gain in 2018 would be the fifth-largest in the S&P 500. Reflecting the interest of index-tracking funds, the stock jumped 4.2 percent to $39.49 at 7:57 a.m. in New York Tuesday, putting it on pace to reach a three-year intraday high.
Analysts are not sanguine about the stock’s prospects. Their average forecast implies a 19 percent decline from Monday’s closing price over the next 12 months, data compiled by Bloomberg showed.
San Francisco-based Twitter has more than doubled from last year’s low on optimism over Chief Executive Officer Jack Dorsey’s strategy to push into live video and more personalized content. After more than 16 quarters of losses, the company reported a second quarter of profits earlier this year.
More than $7.8 trillion of assets are benchmarked to the S&P 500, S&P data on its website showed.
To contact the reporter on this story: Lu Wang in New York at lwang8@bloomberg.net
To contact the editors responsible for this story: Courtney Dentch at cdentch1@bloomberg.net, Chris Nagi
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