Amazon to replace Walgreens in Dow Industrial Average next week

Amazon will replace Walgreens Boots Alliance in the Dow Jones Industrial Average, S&P Dow Jones Indices, which manages the price-weighted measurement of 30 stocks, said on Tuesday. Amazon shares moved up 1% in extended trading, and Walgreens stock moved 3% lower.

The move will result in more exposure to the online retailer for investors who bet on the average, which is far smaller than the S&P 500 index.

The change goes into effect prior to market open on Feb. 26.

“Reflecting the evolving nature of the American economy, this change will increase consumer retail exposure as well as other business areas in the DJIA,” S&P Dow Jones Indices said in a statement.

The company said the revision was “prompted” by Walmart’s 3-for-1 stock split, resulting in lower index weight for Walmart.

Today’s Amazon is more than just retail. Since 2021, it’s been run by Andy Jassy, who built up Amazon’s cloud business. That segment leads the market, giving Amazon 14% of revenue and most of its operating profit.

Plus, there’s revenue coming in from Amazon promoting products in search results.Amazon’s advertising business delivered 27% revenue growth in the fourth quarter, faster than at Alphabet, Meta and Microsoft.

Amazon’s arrival in the Dow Jones comes three years after business software maker Salesforce joined, along with Amgen and Honeywell International.

This is breaking news. Please check back for updates.