MicroStrategy to Join Nasdaq 100 on December 23

According to a recent Nasdaq press release, MicroStrategy, the business intelligence platform and software provider founded by Michael Saylor, will join the Nasdaq 100 on Dec. 23. Along with Palantir Technologies and Axon Enterprise, it will replace Illumina, Super Micro Computer, and Moderna in the index.

The Nasdaq 100 comprises the 100 largest non-financial companies listed on the Nasdaq stock exchange and is a benchmark for myriad financial products, such as options, futures, and ETFs. Microsoft, Amazon, Meta, Netflix, Nvidia, and Tesla are some prominent names on the list.

MicroStrategy’s MSTR has been one of the best-performing stocks this year. It is up 524% year-to-date (YTD) and has outperformed the S&P 500, which is up 28%. MSTR’s price surge is due to Bitcoin’s ongoing rally, as the company is the largest corporate holder of Bitcoin, with 439,000 BTC in its possession.

Following its inclusion in the Nasdaq 100, MicroStrategy will get exposure to billions in passive investments from ETFs tracking the list, such as Invesco’s QQQ Trust.

S&P 500 Speculation

Following MicroStrategy’s addition to the Nasdaq, analysts have begun speculating whether it could be added to the S&P 500 index next.

In a recent X post, Bloomberg analyst Eric Balchunas said it would take a while and depend on whether an accounting rule is changed. MicroStrategy has only been profitable in one of the last four quarters.

“The S&P index committee has complete discretion over what’s added to the index and has kept stocks, including Tesla, out of the benchmark in the past despite their size. Typically, the barrier is the index’s profitability screen; MicroStrategy falls short because it’s been profitable on a GAAP basis in just one of its past four quarters,” said Bloomberg analyst James Seyffart in an X post.