AppLovin, Robinhood, and Emcor Rally on News They Will Join the S&P 500. Here’s Who Didn’t Make the Cut.

Robinhood is due to join the S&P 500 later this month. ( LIONEL BONAVENTURE/AFP via Getty Images)

AppLovin , Robinhood Markets , and Emcor Group will join the S&P 500 index later in September in conjunction with the index’s quarterly rebalancing, according to S&P Dow Jones Indices, which oversees the benchmark index.

Those three stocks will replace MarketAxess Holdings , Caesars Entertainment , and Enphase Energy.

Applovin and Robinhood have often been mentioned as candidates for inclusion this year, because they were among the largest companies by market capitalization not in the S&P 500 index.

Shares of the three new additions rallied on the news in after-hours trading. The index changes were announced after the close of trading Friday.

Applovin stock was up 6.3% in after-hours trading to $521.01, while Robinhood was up 6.4% to $107.75 and Emcor was 2.2% higher at $639.

The three stocks will be added to the S&P 500 index before the start of trading on Monday, Sept. 22.

S&P Dow Jones Indices said the three changes, plus others involving the S&P MidCap 400 and S&P SmallCap 600 index that were unveiled on Friday, “ensure each index is more representative of its market capitalization range.”

“We are thrilled to be recognized by S&P Global as a new member of the S&P 500,” said Chief Financial Officer, Jason Warnick. “We remain focused on our mission to democratize finance for all – we’ve made great progress and there’s much more to do.”

The three companies leaving the S&P 500—MarketAxess, Caesars, and Enphase—each have market capitalizations of just $5 billion to $7 billion and are among the smallest in the index. AppLovin, by contrast, has a market capitalization of $169 billion, making it the largest U.S. company that wasn’t in the S&P 500. Robinhood and Emcor have market caps of $91 billion and $28 billion, respectively. Emcor is moving up from the S&P MidCap 400, where it was among the top stocks along with Interactive Brokers.

Before the news late Friday, there was speculation that Strategy—the biggest corporate Bitcoin holder—could be added to the S&P 500 in conjunction with the rebalancing, but it didn’t make the cut. Its shares were down about 3% in after-hours trading to $326 on apparent investor disappointment. The stock finished the regular Friday session 2.5% higher at $335 in part on index addition speculation.

Strategy’s market value is $93 billion, well above the minimum of $22.7 billion for new entrants into the S&P 500—and it’s now one of the largest companies not in the S&P 500 index. It’s not in the S&P midcap or small-cap indexes, either.

Strategy could have a hard time getting added to the S&P 500. One issue is that Strategy is more of a Bitcoin repository than an operating company with ongoing earnings. The company’s software business is small. (S&P Dow Jones Indices doesn’t allow closed-end funds and ETFs into the index.)

Write to Andrew Bary at andrew.bary@barrons.com