To Replace Freddie Mac On S&P 500 - InformationWeek
Cloud // Software as a Service
02:37 PM
How Cloud Can Streamline Business Workflow
Jul 11, 2017
In order to optimize your utilization of cloud computing, you need to be able to deliver reliable ...Read More>> To Replace Freddie Mac On S&P 500

The selection of shows recognition of cloud computing, says CEO Marc Benioff.

While the government's takeover this week of Fannie Mae and Freddie Mac will go down as one of the defining moments of an economically troubled year, a related event signals Wall Street's growing appreciation of Web-based business computing.

Standard & Poor's said it's removing Freddie Mac from its S&P 500 index after the close of trading on Wednesday, and replacing it with, the 9-year-old company largely responsible for the growing software-as-a-service movement, and in important player in the broader, emerging market of cloud computing.

Salesforce CEO Marc Benioff gave an uncharacteristically humble response to the development when contacted by InformationWeek, implying that Standard & Poor's decision is indicative of a movement bigger than his company. "I am delighted to see cloud computing get this recognition with this decision," Benioff said in an e-mail Wednesday morning.

Earlier this week, the U.S. government took control of Freddie Mac (Federal Home Loan Mortgage) and Fannie Mae (Federal National Mortgage Association), fired their executives, and placed the companies in conservatorship. Freddie Mac's market capitalization had fallen to $614 million by Tuesday, well below the $5 billion required to stay on the S&P 500.

Salesforce, with a market cap of approximately $6.8 billion, will be added to the index after trading closes on Friday.

When evaluating companies for inclusion on the S&P 500, Standard & Poor's considers such things as corporate structure, sector representation, accounting standards and exchange listings, financial viability, and whether the company has adequate liquidity and a reasonable stock price, according to the S&P Web site. At least half of an S&P 500 company's outstanding shares must be publicly owned.

Fastenal, a manufacturer of industrial and construction supplies, will replace Fannie Mae on the S&P 500 after close of trading on Friday.

Among the 10 largest companies on the S&P 500 based on market cap, three are in IT: Microsoft, IBM, and Apple.

Comment  | 
Print  | 
More Insights
Newest First  |  Oldest First  |  Threaded View
How Enterprises Are Attacking the IT Security Enterprise
How Enterprises Are Attacking the IT Security Enterprise
To learn more about what organizations are doing to tackle attacks and threats we surveyed a group of 300 IT and infosec professionals to find out what their biggest IT security challenges are and what they're doing to defend against today's threats. Download the report to see what they're saying.
Register for InformationWeek Newsletters
White Papers
Current Issue
IT Strategies to Conquer the Cloud
Chances are your organization is adopting cloud computing in one way or another -- or in multiple ways. Understanding the skills you need and how cloud affects IT operations and networking will help you adapt.
Twitter Feed
InformationWeek Radio
Archived InformationWeek Radio
Join us for a roundup of the top stories on for the week of November 6, 2016. We'll be talking with the editors and correspondents who brought you the top stories of the week to get the "story behind the story."
Sponsored Live Streaming Video
Everything You've Been Told About Mobility Is Wrong
Attend this video symposium with Sean Wisdom, Global Director of Mobility Solutions, and learn about how you can harness powerful new products to mobilize your business potential.
Flash Poll