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Walmart (WMT) will join the Nasdaq 100 on Jan. 20 after switching from the NYSE to Nasdaq in December.
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Walmart’s stock returned 150% over the past few years compared to 104% for the Nasdaq 100.
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The addition could attract up to $19B in index-fund inflows to Walmart.
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The Nasdaq 100 is an index most often associated with technology stocks like Nvidia (NASDAQ:NVDA) and Apple (NASDAQ:AAPL) due to its historical focus on innovation and high-growth companies. While it is not a “pure” technology index — there is a separate Nasdaq 100 index devoted exclusively to tech stocks — its heavy tilt towards tech-driven companies makes it the benchmark many investors associate with technology.
On Jan. 20, though, a new stock will be added to the index that is decidedly not a tech name: retail behemoth Walmart (NASDAQ:WMT).
Despite the index’s reputation for being the premier tech index, it actually is home to a variety of companies in different sectors, including retailers like Costco (NASDAQ:COST), beverage companies such as PepsiCo (NASDAQ:PEP), as well as other consumer-facing companies including Starbucks (NASDAQ:SBUX), Kraft Heinz (NASDAQ:KHC), and Lululemon Athletica (NASDAQ:LULU).
Yet it’s this diversity sprinkled among tech giants such as Microsoft (NASDAQ:MSFT) and Broadcom (NASDAQ:AVGO), that makes them the exceptions that prove the rule. The index’s composition reflects a broader representation of the modern economy, where technology intersects with traditional industries, but the core remains dominated by innovative tech leaders.
Nasdaq determines companies for inclusion in the index based on criteria such as being listed exclusively on the Nasdaq Global Select or Global Market tiers, having an average daily trading volume of at least 200,000 shares, and maintaining a minimum three-month average daily traded value of $5 million.
Companies must also have a free float of at least 10%, be publicly traded for at least three months, be current with quarterly and annual reports, and not be in bankruptcy proceedings. Additionally, the index excludes financial companies and includes only the largest non-financial stocks by market capitalization, with annual rebalancing in December and potential special rebalances.
Walmart will replace AstraZeneca (NASDAQ:AZN) when the change is made on Jan. 20, before the market opens, following Walmart’s recent switch from the NYSE to Nasdaq in December to align with its tech-focused transformation.
