Investors looking for a bright spot in this market need only glance at Vici Properties (NYSE:VICI). Today, VICI stock has rocketed approximately 4% higher on news that the real estate investment trust (REIT) will be added to the S&P 500.
Like any index addition, this is a big break for the casino REIT. However, entrance into the S&P 500 — which only holds the top 500 companies in the U.S. — is a very big deal.
This inclusion of Vici and two other companies is part of the index’s rebalancing period. For Vici, the upcoming addition will take place on June 8.
Now, investors appear eager to get in early. Index fund managers will be forced to buy shares of VICI stock, providing a near-term catalyst for the company. A broadening investor base and institutional exposure may benefit smaller investors as well.
Let’s dive more into what the index announcement means for investors.
What to Make of S&P 500’s VICI Stock Addition
Notably, Vici is one of two publicly traded REITs that could have made it into the index, the other being rival Gaming and Leisure Properties (NASDAQ:GLPI). Keurig Dr Pepper (NASDAQ:KDP) and ON Semiconductor (NASDAQ:ON) will be joining the index alongside Vici, however.
A range of other gaming companies focused on the Las Vegas market are listed in the S&P 500. However, Vici’s growth — primarily driven by recent acquisitions — has propelled VICI stock onto the radar of index managers. Notably, the company recently acquired the Venetian and MGM Growth Properties. That gives it a more robust portfolio of properties in Las Vegas.
With the economic reopening continuing to drive more traffic to Vegas, investors looking for exposure to this trade now have more options on the S&P 500. Of course, recession worries are the monkey wrench people are trying to factor in right now. Still, this inclusion is certainly a compelling catalyst to watch.
On the date of publication, Chris MacDonald did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.