Paramount may bid farewell to the S&P 500! Goldman Sachs' 'Top Contenders' list is revealed, including Applovin and 15 other companies!

According to Reuters, $Paramount Global-B(PARA.US)$ That is, the merger with Skydance Media is expected to be completed by August 7, and the $8.4 billion Trade has already been approved by the Government.

The Transaction is completed, and the Company will be renamed Paramount Skydance Corp and the other shares will be traded under the PSKY Stock Code, and the merger is expected to be completed on August 7.

It is noteworthy that Peramon Global is currently an S&P 500 Index stock, and the PSKY in the future may not conform to the standard of the S&P 500 Index. Therefore, it is possible that the IPO Committee will move other S&P 500 Index shares and can also be held in public Become a new member of the S&P 500 Index.

Looking at this, at least investors may be wondering what are the benchmarks for S&P 500 Index shares? Which companies should be selected? What is the stock price after the selection process? The following will be clarified.

What are the criteria for inclusion in S&P 500?

To become a constituent stock of the S&P500 index, a company must meet a series of specific requirements or standards. These standards are determined by the issuer of the index. Companies that meet these requirements are usually top companies and leaders in different Industries. Here are some key entry standards:

1. Place of incorporation: Must be a US company

2. Market Cap: The unadjusted Market Cap of the resulting shares should be at least US$22.7 billion, and the circulating market capitalization is less than 50% of the minimum total market capitalization, approximately US$11.35 billion;

3. PROFITABILITY: POSITIVE NUMBERS OF REPORTED EARNINGS FOR THE LAST FOUR CONSECUTIVE QUARTERS AND REPORTED EARNINGS FOR THE MOST RECENT QUARTER;

4. Stocks Liquidity: The floating-to-floating-stock adjustment ratio (FALR) must be greater than or equal to 0.75.

5. Public shareholding: Public shareholding is at least 50% of the outstanding number of foreign shares.

Yes, you won't be eligible for any of the above requirements. Model 500 items are not automatically generated, and ultimately require staff audits by Dow Jones Industrial Average Committee members to ensure Industry breakdown and consistency.

Ask Futubull AI:What are the S&P 500 Standards and Implications?

Accordingly, the Barron publication estimates that a delisting of Peramon is very likely, as the new Market Cap will be around US$11 billion to the left due to the current share price and trading conditions, which may not meet the requirements of the APF.

In addition, upon completion of the Trade, Skydance will own approximately 70% of the shares of the Company, which is expected to have a public shareholding of about 30%, short of the 50% public shareholding required under the Standard 500. Beyond that, Barron published a floating Market Cap of less than $4 billion, far below the desired $11.35 billion.

Which companies are eligible for selection?

The latest Goldman Sachs Research Reports listed the list of candidates to be selected as follows:

Popular stocks included $Applovin(APP.US)$ 、 $Robinhood(HOOD.US)$ , and energy stocks $Cheniere Energy(LNG.US)$ 、Liquid refrigeration supplier $Vertiv Holdings(VRT.US)$ Cloud Medical Shares $Veeva Systems(VEEV.US)$ , Used Car Retailers $Carvana(CVNA.US)$ , Aerospace and Defense Providers $Heico(HEI.US)$ , Asset Management Company $Ares Management(ARES.US)$ The Largest Independent Brokerage Traders in the United States $LPL Financial(LPLA.US)$ 、 $First Citizens BancShares(FCNCA.US)$ , USA Online Brokers $Interactive Brokers(IBKR.US)$ , American insurance companies $Markel Group(MKL.US)$ , Construction Contractors $EMCOR Group(EME.US)$ , Restaurant and Beverage Software Technology Company $Toast(TOST.US)$ , CNI Xiangmi Lake Fintech Index $SoFi Technologies(SOFI.US)$ 。

Among others, Interactive Brokers and EMCOR Group are already the benchmark P400 index shares.

How did the share price perform after the election?

According to the latest Goldman Sachs Research Reports, an average of 20 companies have entered the S&P 500 over the past 10 years. Starting in 2021, this effect has reappeared, with an average daily superannuation of 4pp for 2021-2025.

Goldman Sachs acknowledges that this kind of recovery is underpinned by structural changes: ETF Floating Funds, Individual Investor Trade Favorites, and AI as the impetus for new topics.

The best indicators in the near term have been attributed to the growth of the new stock market by individual investors. After the new pandemic, individual investor trading activity in the stock market showed significant gains on the day, as well as at the stock level. Based on data from Goldman Sachs Global Banks and Markets, $Coinbase(COIN.US)$ 、 $Super Micro Computer(SMCI.US)$ und $Palantir(PLTR.US)$ Very popular with personal investors and a big hit on the day of announcements, the index's inclusion effect also overlaps with popular topics such as AI. Some of the best performing indices add constituents, such as $Super Micro Computer(SMCI.US)$ 、 $Palantir(PLTR.US)$ und $Datadog(DDOG.US)$ , has involved various parts of the AI investment cycle.

However, Goldman Sachs specifically pointed out that if a company's output is the benchmark P400 index, the average current average of P500 is -0.4pp. if it is directly outside the P400, the average is +5.3pp.

For this reason, a growing number of mid-cap stocks (the S&P 400) over the past few years have attracted passive capital layouts in advance, making the day of the index's official inclusion a “redemption moment”; and it is easier for unexpected upside movements to occur directly by listing S&P 500 stocks.

As a whole, entering the S&P 500 is a catalyst for structural change.”

For example, in the case of hot Industry (AI, software, clean energy, etc., individual investors have a high focus on stocks, or large companies that are directly involved: this is not just a floating Bid, it is more likely to involve a circular valuation.