DoorDash Stock Jumps on S&P 500 Inclusion

DoorDash is among four companies set to join the S&P 500, while AppLovin and Coinbase were not selected.

The committee responsible for choosing S&P 500 components exercises discretion in its selections, and this time, it appears to have prioritized stability over volatility.

S&P Dow Jones Indices announced Friday that four companies will be added to the index later this month. DoorDash Inc. (DASH) is the largest of the new entrants, joining TKO Group Holdings Inc. (TKO), Williams-Sonoma Inc. (WSM), and Expand Energy Corp. (EXE).

The S&P 500 consists of some of the largest U.S. companies by market capitalization, but inclusion is based on more than size alone. Companies must meet criteria related to profitability, public float, and other factors. Additionally, the selection committee considers aspects like sector diversification and stock volatility.

While DoorDash met the eligibility requirements, it was not the largest company considered. AppLovin Corp. (APP) and Interactive Brokers Group Inc. (IBKR) both have larger market caps but were not chosen.

Notably, the committee did not introduce any new technology companies to the S&P 500 in this round. Though DoorDash operates in the tech-driven food-delivery space, it is classified as a consumer-discretionary company. It may have been viewed as a more stable option than AppLovin, which recently came under scrutiny following two short-seller reports.

AppLovin’s stock surged more than 700% in 2024 but has declined early in 2025. By contrast, DoorDash shares rose 70% last year and have continued climbing. The company recently qualified for S&P 500 inclusion after meeting profitability requirements.

Coinbase Global Inc. (COIN), though smaller than DoorDash, was another widely discussed candidate that was ultimately left out. As a cryptocurrency exchange, Coinbase operates in an industry subject to a rapidly evolving regulatory landscape. Its stock has surged over 500% since the end of 2022, but its volatility may have factored into the committee’s decision.

Historically, stocks that experience rapid gains ahead of S&P 500 inclusion often face volatility. Super Micro Computer Inc. (SMCI), added in March 2024, has seen its stock price decline by more than half since its inclusion, weighed down by financial control concerns and increasing competition in the server market. The company’s stock remains one of the most volatile in the index.

Bernstein analysts have noted that while new entrants tend to outperform the S&P 500 in the year leading up to their addition, their relative returns tend to diminish shortly after the announcement.

Stocks typically see an immediate boost after being named as future S&P 500 constituents, as index-tracking funds must purchase shares of the new entrants. This was evident in Friday’s extended trading session, where DoorDash shares climbed 6%, TKO gained 2.4%, Williams-Sonoma rose 1.6%, and Expand Energy advanced 2.3%.

Conversely, stocks of companies that were not selected saw declines. AppLovin dropped 4.3%, Interactive Brokers fell 2.6%, and Coinbase slipped 2.1% in after-hours trading.

The four new S&P 500 entrants will replace BorgWarner Inc. (BWA), Teleflex Inc. (TFX), Celanese Corp. (CE), and FMC Corp. (FMC) before trading begins on March 24.