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Walmart (WMT) will join the Nasdaq 100 on Jan. 20 after switching from the NYSE to Nasdaq in December.
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Walmart’s stock returned 150% over the past few years compared to 104% for the Nasdaq 100.
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The addition could attract up to $19B in index-fund inflows to Walmart.
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The Nasdaq 100 is an index most often associated with technology stocks like Nvidia (NASDAQ:NVDA) and Apple (NASDAQ:AAPL) due to its historical focus on innovation and high-growth companies. While it is not a "pure" technology index -- there is a separate Nasdaq 100 index devoted exclusively to tech stocks -- its heavy tilt towards tech-driven companies makes it the benchmark many investors associate with technology.
On Jan. 20, though, a new stock will be added to the index that is decidedly not a tech name: retail behemoth Walmart (NASDAQ:WMT).
Diversity Beyond Tech Giants
Despite the index's reputation for being the premier tech index, it actually is home to a variety of companies in different sectors, including retailers like Costco (NASDAQ:COST), beverage companies such as PepsiCo (NASDAQ:PEP), as well as other consumer-facing companies including Starbucks (NASDAQ:SBUX), Kraft Heinz (NASDAQ:KHC), and Lululemon Athletica (NASDAQ:LULU).
Yet it's this diversity sprinkled among tech giants such as Microsoft (NASDAQ:MSFT) and Broadcom (NASDAQ:AVGO), that makes them the exceptions that prove the rule. The index's composition reflects a broader representation of the modern economy, where technology intersects with traditional industries, but the core remains dominated by innovative tech leaders.
How Walmart Made the Cut
Nasdaq determines companies for inclusion in the index based on criteria such as being listed exclusively on the Nasdaq Global Select or Global Market tiers, having an average daily trading volume of at least 200,000 shares, and maintaining a minimum three-month average daily traded value of $5 million.
Companies must also have a free float of at least 10%, be publicly traded for at least three months, be current with quarterly and annual reports, and not be in bankruptcy proceedings. Additionally, the index excludes financial companies and includes only the largest non-financial stocks by market capitalization, with annual rebalancing in December and potential special rebalances.
Walmart will replace AstraZeneca (NASDAQ:AZN) when the change is made on Jan. 20, before the market opens, following Walmart's recent switch from the NYSE to Nasdaq in December to align with its tech-focused transformation.
Story continuesWalmart Has Been a Growth Dynamo
Walmart's recent earnings results show continued strength. In its fiscal third quarter, revenue reached $179.5 billion, up 5.8% year-over-year, beating analyst estimates of $177.4 billion, as adjusted earnings came in at $0.62 per share, also above the expected $0.60 per share.
Globally, e-commerce sales grew 27%, with U.S. comparable sales up 4.5% excluding fuel, helping net income surge 34% to $6.1 billion, or $0.77 per share, from $4.58 billion the previous year. Walmart also raised its full-year guidance, expecting net sales growth of about 5% at the midpoint and adjusted earnings of $2.58 to $2.63 per share.
This kind of performance has led to market-beating gains by Walmart's stock. Over the past few years, Walmart had a total return of about 150% compared to 104% by the Nasdaq 100. That is despite the monstrous gains posted by the index's most-heavily weighted components like Nvidia, Amazon (NASDAQ:AMZN), and Meta Platforms (NASDAQ:META).
This stems from Walmart's successful pivot to omnichannel retail, investments in supply chain technology, and gains in higher-income customer segments, allowing it to weather economic pressures better than pure tech plays during volatile periods like 2022.
Key Takeaway
In addition to the Nasdaq 100, Walmart will also be added to the Nasdaq-100 Equal Weighted Index and the Nasdaq-100 Ex-Tech Sector Index. As the Nasdaq 100 bills itself as representing the "new 21st century economy," Walmart is a natural fit for inclusion. The retailer's integration of AI, automation, and e-commerce -- such as AI-powered supply chain optimization, predictive analytics, and personalized shopping experiences -- aligns with the index's emphasis on innovation.
Walmart's shift to a Nasdaq listing in late 2025 after more than 50 years on the NYSE, underscores its tech ambitions, positioning it alongside growth-oriented companies. This addition could attract up to $19 billion in index-fund inflows, boosting liquidity and visibility while highlighting how traditional retailers are evolving in a digital era.
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