Super Micro Computer’s (SMCI) stock is being added to the Nasdaq 100 index, replacing Walgreens Boots Alliance (WBA).
Super Micro Computer’s stock will officially be added to the Nasdaq 100 before the start of trading on July 22.
The latest change to the Nasdaq 100 reflects both the meteoric rise of Super Micro Computer’s stock and the sharp decline in Walgreens’ market value.
The Nasdaq 100 index, or “NDX” as it is known, is comprised of the 100 largest non-financial companies in the broader Nasdaq Composite index.
Super Micro Computer’s inclusion in the Nasdaq 100 should give its stock a boost as mutual funds and exchange-traded funds that track the index will now be required to buy its shares.
The biggest exchange-traded fund that tracks the Nasdaq 100 is the Invesco QQQ Trust, known as the “Triple Q” or simply the “Q.”
Like all indices, the Nasdaq 100 makes changes to its components on a monthly and quarterly basis. In June, Arm Holdings (ARM) replaced Sirius XM Holdings (SIRI) in the Nasdaq 100.
Companies must maintain a weighting of at least 0.1% of the Nasdaq 100’s market value to remain in the index, which is now worth more than $20 trillion U.S.
Walgreens, whose shares have declined 57% year-to-date, has a market value of $10 billion U.S., or about 0.05% of the index’s value. Walgreens had the lowest market cap in the index.
In contrast, Super Micro Computers’ stock has more than tripled this year, giving the company a market capitalization of $53 billion U.S.
Super Micro Computer’s stock is currently trading at $909.96 U.S. per share, having risen 201% in the last 12 months.
Super Micro Computer makes servers that run artificial intelligence (A.I.) microchips and processors and its products are in high demand right now.
