Amazon Inc. AMZN is set to join the Dow Jones Industrial Average (DJIA), a move that may not be as favorable for the company as it appears.
What Happened: During CNBC’s Last Call, host Brian Sullivan expressed that Amazon replacing Walgreens Boots Alliance Inc. WBA in the DJIA before the market opens on Feb. 26 might not be positive news for Amazon.
Sullivan compared Amazon with other Magnificent 7 stocks like Microsoft and Apple, who, after joining DJIA, experienced a flat stock situation for several years before spiking.
For Apple, the first two years after joining DJIA was “dead money” while Microsoft saw a flat stock for almost 15 years on the index.
“Will history repeat itself for Amazon?” Sullivan raised the question.
Why It Matters: Amazon’s shares traded higher in Tuesday's after-hours session following the announcement of its inclusion in the DJIA.
S&P Dow Jones Indices stated that Amazon’s inclusion will increase consumer retail exposure and other business areas in the DJIA, reflecting the evolving nature of the American economy.
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