Where to? The S&P 500… Investors revved up Uber shares after news that it’s expected to be added to the S&P 500 (ETA: December 18). Refresher: the S&P 500 tracks the performance of America’s top 500 public companies, and is often used as a benchmark for the broader market. Companies joining the S&P club may sometimes see a temporary stock boost, because their addition can drive buying from fund managers.
Swap: Roughly a third of S&P companies have been replaced since 2015, and 11 companies have been added this year, including Airbnb and Lululemon.
Criteria: To qualify for S&P inclusion, companies need at least a $14.5B market cap and positive earnings for the past four quarters.
5-star year… Uber’s market cap broke through $100B last month for the second time ever. It’s now sitting pretty at $119B — well above the S&P’s median market cap of $31B. Uber has delivered an operating profit for two straight quarters, showing after years of doubt that its biz can make $$. In Q3, Uber notched record ridership, with strong growth in both ride-hailing and food delivery. Another win for Uber this year: California upheld Prop 22. The gig company also expanded its package delivery and advertising businesses (think: in-app promos). Uber aims to make $1B next year from ads alone.
The “Uber for [insert service]” is Uber…. In the 2010s, Uber was in a race against Lyft to be the dominant ride-hailing company. Now Uber’s in a different league than its much smaller rival as it tries to become an app for lots of services. Its food-delivery biz takes a 24% bite out of DoorDash’s market-share dominance. Up next: Uber’s testing a TaskRabbit-like service.