Tesla Set to Become a Top 10 Company in the S&P 500
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Tesla Set to Become a Top 10 Company in the S&P 500

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Tesla Set to Become a Top 10 Company in the S&P 500

The Briefing

  • With positive earnings in each of the last four quarters, Tesla is now eligible to join the S&P 500. They will be the 8th largest stock and 7th largest company on the benchmark index, with a market cap of $544 billion
  • Tesla’s inclusion in the S&P 500 will commence in December of this year—an additional blow to Tesla bears as the index brings with it an additional layer of prestige

The New Kid On The Block

Tesla will be joining the S&P 500 in December, gaining eligibility for inclusion after posting positive earnings over four consecutive quarters.

In Q3’20, the company made $331 million in profits, and delivered 139,300 vehicles. The stock has been on a tear in recent years, and joining the index only furthers the automaker’s momentum – dealing another blow to the increasingly hopeless short sellers along the way.

CompanyMarket CapTTM Earnings
Apple$1,971B$55B
Microsoft$1,617B$44B
Amazon$1,569B$11B
Alphabet$1,193B$34B
Facebook$785B$18B
Berkshire Hathaway$547B$81B
Tesla$544B$0.5B
Walmart$430B$14B
Visa$411B$10B
Johnson & Johnson$377B$34B

Anything But Standard

Standard & Poor’s have quite the criteria before a company can be considered for inclusion in their flagship index. To be part of the S&P 500, a minimum market cap of $8.2 billion is required.

Of course, market cap is not where Tesla’s weakness is. Valued at $544 billion, right off the bat they will be one of the top S&P 500 companies. Rather, net income has been the struggle for Tesla. After government subsidies, they posted $556 million in trailing twelve month (TTM) profits, placing them 357th in the index.

By market cap, Tesla runs with some of the all-time greats and will be the largest inclusion to join the index ever. When ranked by net income though, a much different ranking emerges:

RankCompanySymbolAnnual Net Income
355Tractor Supply CompanyTSCO$562M
356Mettler-Toledo InternationalMTD$561M
357TeslaTSLA$556M
358Huntington Ingalls IndustriesHII$549M
359Zebra TechnologiesZBRA$544M

By this metric, the automaker can be found adjacent to lesser-known Mettler-Toledo and Tractor Supply Company.

The EV Revolution

As the electric car movement continues full steam ahead, Tesla as the market leader will play a pivotal role in society’s transition towards it. The average cost of the Model 3 is decreasing, thus increasing its affordability. This marks a positive signal as widespread adoption often above all requires feasibility for the masses.

As governments worldwide continue to bolster their arsenal in combating climate change, it catalyzes the demand for both electric vehicles and Tesla shares. With short seller activity beginning to subside, Tesla’s official kickoff in the S&P 500 next month could be the next chapter for Elon Musk & Co.

Where does this data come from?

Source: Asset Dash and Barchart.com.
Notes: Financial data is as of November 25th, 2020

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Ranked: The Top Online Music Services in the U.S. by Monthly Users

This graphic shows the percentage of Americans that are monthly music listeners for each service. Which online music service is most popular?

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Top Online Music Services in the U.S.

The Briefing

  • Two-thirds of music listeners in the U.S. used YouTube at least once per month
  • 64% of music listeners use multiple music services per month

The Top Online Music Services in the U.S.

The music streaming industry is characterized by fierce competition, with many companies vying for market share.

Companies are competing on multiple fronts, from price and features to advertising and exclusive content, making it a challenging market for companies to succeed in.

YouTube (the standard offering and YouTube Music) has the highest amount of users, attracting around two-thirds of music listeners in the U.S. during a given month. This is largely due to the YouTube’s massive reach and extensive catalog of music.

Here’s a full rundown of the top music streaming services in the U.S. by monthly listeners:

RankMusic Service% of U.S. Music Listeners Who Use Monthly
#1YouTube61%
#2TSpotify35%
#2TAmazon Music 35%
#4Pandora23%
#5SiriusXM21%
#6Apple Music19%
#7iHeartRadio15%
#8SoundCloud10%
#9Audacity6%
#10TTuneIn5%
#10TDeezer5%
#10TNapster5%
#10TTidal5%

Two companies are in the running for second place: Spotify and Amazon Music.

Spotify leads in one important metric: number of paid users. Meanwhile, Amazon Music has a large user base since the service is bundled into Prime—however, recent changes mean that without a premium subscription, shuffled playback is the primary option. Time will tell what impact those changes will have on the service’s market share.

Prices for premium music services are beginning to creep upward. Apple Music and Amazon Music raised their prices, and it’s rumored that Spotify will not be far behind. This move would be significant because, in the U.S., Spotify hasn’t raised its prices in over a decade.

Rising prices and more aggressive promotion of premium subscriptions could be a signal that music streaming services are transitioning from a focus on capturing market share to monetizing existing users.

Where does this data come from?

Source: Activate Technology and Media Outlook 2023 by Activate Consulting

Data note: “Music services” include free and paid services used for listening to music through any format excluding terrestrial radio. “Music listeners” are defined as adults aged 18+ who spend any time listening to music.

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