Tesla will be added to the S&P 500 index. Elon Musk’s Tesla reached another landmark on November 16 when it officially qualified for the prestigious S&P 500. Based on its market value, the electric car maker would be one of the top 10 companies in the benchmark index upon entry.
S&P Dow Jones Indices announced after the closing bell. Tesla shares jumped nearly 11% in after-hours trading.
Tesla became eligible to join the S&P 500 after posting its fourth consecutive profit in the second quarter of this year. However, it was not selected for inclusion in the index in September.
Tesla shares have soared 387.8 percent this year as the company is finally making money consistently and continues to hit milestones for deliveries of its vehicles.
Admission to the benchmark, to take effect with the quarterly rebalancing on December 21, comes almost three months after Tesla first qualified to join the S&P 500, potentially adding to demand its shares from new investors who track the index. The stock rose earlier this year as investors anticipated its elevation to the index, only to retreat after S&P Dow Jones Indices passed on it over in several index reshuffles.
The late-Monday bounce added more than $50 billion to the electric carmaker’s stock market value and put it back within 8 percent of the record hit in August after an intense rally. The news stamps an official stock market imprimatur on the company that has done more than any other to bring electric cars into the mainstream, and caps an eventful three days for Elon Musk, its chief executive.