Robinhood has once again been left out of the S&P 500. Instead, Trade Desk will be included in the index

The popular platform for trading on the stock market Robinhood Markets again did not wait for inclusion in the S&P 500 index: its new member will be an advertising buying service Trade Desk. Robinhood's shares have since sagged in price - the company has been considered one of the main contenders for inclusion in the index lately.

S&P 500 operator S&P Dow Jones Indices said on July 14 that Trade Desk will replace Ansys in the benchmark U.S. stock index before trading opens on July 18. That's because chip design software maker Synopsys is expected to close its acquisition of engineering software developer Ansys a day earlier. This is the second change in the S&P 500's July lineup caused by a merger. On July 9, Datadog replaced Juniper Networks in the index following its purchase by Hewlett Packard.

On the news of inclusion in the S&P 500, shares of Trade Desk jumped almost 15% in the New York postmarket. Robinhood, on the other hand, lost 0.7% - investors may have hoped that the company would get the vacated space in the index, as it was supposed to do in the case of Juniper and at the scheduled revision in June.

There are capitalization thresholds, profitability rules, and other criteria for inclusion in the S&P 500, but beyond that, the index committee can use its discretion in selecting new members. Inclusion in the S&P 500 usually causes stocks to rise because the numerous funds that track the index have to purchase these securities and thus increase demand. In addition, the mere fact that a stock is included in the index is seen by investors as a sign of quality, notes MarketWatch.

Robinhood's rapid stock growth has recently made it a prime candidate for inclusion in the S&P 500. With a capitalization of $88 billion, it is twice as large as Trade Desk ($37 billion) and remains one of the largest companies outside the index. Since the beginning of the year, Robinhood shares have gained 168% while Trade Desk securities have sagged 36%.

In February 2025 Trade Desk shares plunged 33% in a single day following the release of a weak financial report that Jefferies analyst James Heaney called "a major disappointment," reports MarketWatch. But in late June, when the securities were trading around $68, Evercore ISI analyst Mark Mahaney raised its rating from Neutral (Hold) to Buy and said it was "one of the most stable and high-quality" assets in the Internet sector. At the close of trading on July 14, the stock was 17% below the target level set by Evercore.

Robinhood stock has jumped 9.5% over the past four trading days on the back of bitcoin's rise to new all-time highs. Although the company's average target price of $92.86 per share is still 7% below the current one, FactSet's consensus rating for Robinhood is "Above Market" (Overweight, consistent with a Buy recommendation).

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