Key Takeaways
- Cava shares climbed Thursday following the announcement that the restaurant chain will join the S&P MidCap 400 next week.
- Cava is replacing Altair Engineering, which has been acquired by the German tech company Siemens.
- Angi will also join the S&P SmallCap 600 once it is spun off from IAC next week.
Cava Group (CAVA) shares climbed Thursday following an announcement that the restaurant chain will join the S&P MidCap 400 next week.
Cava will replace Altair Engineering, which is being removed from the index after its acquisition by German tech company Siemens closed on Wednesday. Cava will become part of the index ahead of markets opening on Monday.
Last week, Cava shares also got a boost as JPMorgan analysts encouraged investors to buy after the stock’s recent slide, and outlined a path for the chain to grow to “well beyond” its planned 1,000 stores.
Joining a Major Index Can Lift Demand for a Stock
Being added to an index often boosts a company’s stock, as the addition can introduce a stock to new investors or lead to its inclusion in funds that track a particular index.
S&P Global also said Wednesday that internet company Angi (ANGI) will be added to its S&P SmallCap 600 next week, once its spinoff from IAC (IAC) is completed, replacing ODP Corp. (ODP). IAC also owns Dotdash Meredith, the parent company of Investopedia.
Shares of Cava surged as much as 6% in Thursday afternoon trading before paring back most gains, while shares of Angi added close to 4%. ODP shares lost 2.6%.
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