Dec 11 (Reuters) – Standard & Poor’s on Wednesday said
Facebook Inc will join its S&P; 500 stock index after the
close of trading on Dec. 20, cementing the social media
network’s rise into one of the biggest, most powerful U.S.
companies.
The decision follows Facebook reporting its fourth straight
profitable quarter in October, one of the criteria that S&P; uses
to determine eligibility for the index.
Facebook shares rose 4.3 percent to $51.51 following S&P;’s
announcement after regular market hours. Shares often rise after
a company is tapped for inclusion in the S&P; 500, because many
investors track the index and buy shares of companies that enter
it.
The Menlo Park, California-based company’s shares had closed
Wednesday down 87 cents at $49.38, about 30 percent above their
$38 initial offering price in May 2012, and giving it a roughly
$121 billion market value, Reuters data show.
S&P; said on Dec. 20 it will also add marketing solutions
company Alliance Data Systems Inc and floor covering
company Mohawk Industries Inc to the S&P; 500, and remove
Abercrombie & Fitch Co, JDS Uniphase Corp and
Teradyne Inc. Facebook will also replace Williams Cos
in the S&P; 100 index of large U.S. companies. Williams
will remain in the S&P; 500.
(Reporting by Jonathan Stempel in New York; Editing by Bernard
Orr)
