2026-09-13

Bloom Energy Joins S&P 500 Up 223% YTD as Trade Desk Exits After 70% Crash - Same Rebalance, Opposite Stories

Written & reviewed by the TradeSmrt editorial team · 2026-09-13

In this article

What Happened
Why an Index Swap Actually Moves Prices - Not Just Symbolically
What to Take Away From This
FAQ
Sources

What Happened

On September 4, S&P Dow Jones Indices announced its third-quarter rebalance, and buried in one press release were two of the most opposite stock stories on Wall Street this year. Fuel-cell power company Bloom Energy (NYSE: BE) is joining the S&P 500 alongside Illumina and Everpure, while programmatic advertising platform The Trade Desk (Nasdaq: TTD) is being removed from the index along with Molson Coors and Builders FirstSource. Both changes take effect before the market opens on September 21. On the announcement, Bloom Energy shares jumped as much as 8% in premarket trading while Trade Desk slipped roughly 2%.

The numbers behind the two moves could hardly be more different. Bloom Energy stock was up 223% year-to-date as of early September. Its second-quarter revenue rose 166% year-over-year to $1.065 billion, with product revenue alone up 215%, driven by a boom in demand from AI data centers that want to generate their own power on-site rather than wait years for a grid connection. Against a September 4 close of $252.87, the average price target among 32 covering analysts sits at $292.50 - about 15.6% upside - with UBS raising its target from $300 to $325 and Clear Street lifting its from $290 to $330. Of those 32 analysts, 53% rate the stock a buy, 41% hold, and only 6% a sell.

Trade Desk tells the opposite story. The stock has fallen roughly 70% over the past year and is down nearly 90% from its late-2024 peak. It closed at $14.02 on September 8, putting its year-to-date decline in the 60% range and pushing its market capitalization below $7 billion. Second-quarter revenue grew just 3% year-over-year to $715.1 million - the slowest growth rate in the company's history as a public company - while net income fell 29% to $64.4 million. In an unusually pointed coincidence, the same week the index removal was confirmed, Trade Desk cut about 575 employees, roughly 15% of its workforce. CEO Jeff Green described the move as "a structural reset, not a financial emergency," but Wall Street's response has been cold: of 38 analysts covering the stock, only 3 rate it a strong buy and 1 a moderate buy, versus 26 holds and 8 sell-side ratings (7 strong sell, 1 moderate sell). Trade Desk had only joined the S&P 500 in July 2025, making its exit just 14 months later. It's also skipping the S&P MidCap 400 entirely and dropping straight to the S&P SmallCap 600.

Why an Index Swap Actually Moves Prices - Not Just Symbolically

What makes this pair worth studying is that it shows two things happening at once: a real divergence in business fundamentals, and a mechanical amplifier layered on top of it. Trillions of dollars sit in funds and ETFs that track the S&P 500. When the index's membership changes, those funds are contractually required to buy every new addition and sell every removed name, regardless of what any individual portfolio manager thinks about the stock's prospects. That means Bloom Energy is about to receive a wave of forced buying, while Trade Desk faces a wave of forced selling - and this kind of passive flow tends to concentrate right at the closing auction the trading day before the change takes effect, making the close on Friday, September 18 the moment to watch.

But the mechanical flows only explain part of the story - the deeper cause is that each company sits on the opposite side of a real industry cycle. Bloom Energy's fuel-cell technology used to be viewed as a niche solution for remote or grid-constrained locations. The AI-driven data center buildout has turned that niche into a mainstream growth story almost overnight: as more regions face multi-year waits for new grid interconnections, demand for power generation equipment that can be installed and switched on immediately has become a direct driver of revenue growth. Trade Desk, by contrast, operates in programmatic advertising - a market where Google and Amazon have been steadily building out their own ad platforms and AI-driven targeting tools, squeezing the independent ad-tech layer that Trade Desk represents. Three percent revenue growth isn't a loss, but for a company the market once priced for high-teens or 20%-plus growth, it reads as a near-stall, and that reset in growth expectations - more than any single quarter's numbers - is what's actually driving the valuation collapse.

The contrast even shows up in how the index provider classified the two moves. S&P Dow Jones Indices doesn't automatically shuttle a removed company into the mid-cap tier; placement depends on market capitalization and liquidity screens at the time of removal. Trade Desk skipping the S&P MidCap 400 altogether and landing directly in the SmallCap 600 is itself a data point: the index committee's own market-cap criteria confirm just how far the company's valuation has fallen, not merely that it lost its large-cap seat.

What to Take Away From This

Index inclusion and exclusion are a result, not a cause. Both companies' fundamentals - and their stock prices - had already been signaling this outcome for months before the official announcement. When a rebalance headline breaks, look at the earnings trend that got the company there rather than treating the index change itself as new information.
The same number can mean opposite things depending on what the market expected. Trade Desk's 3% revenue growth is still growth, not a loss, yet it triggered a historic sell-off because the market had priced in far higher growth. A stock that was once a reliable high-growth compounder can see its valuation reset sharply even while staying profitable, once growth decelerates below what's priced in.
Structural industry shifts build quietly, then show up suddenly in earnings. AI data centers' appetite for on-site power was a niche story a few years ago; now it's the core driver of Bloom Energy's growth. Big Tech's push into in-house ad tools has been squeezing independent platforms like Trade Desk more gradually - but the effect eventually shows up the same way, in decelerating growth. Spotting these structural inflection points early can put you months or years ahead of the index-committee headline.
When analyst opinion is sharply divided, dig into why. Bloom Energy's price targets range from $105 to $380 - an unusually wide spread for a stock about to join a major index. Trade Desk simultaneously carries both strong-buy and strong-sell ratings. Whichever side of a stock's story you're looking at, extreme dispersion in analyst views is a signal to examine the underlying assumptions yourself rather than defer to a single number.

FAQ

Is Bloom Energy stock already too expensive after this run?

That concern is real. Some recent analysis notes Bloom Energy has already pulled back from its early-September peak and argues upside from current levels may be limited over the next year. Still, a majority (53%) of the 32 analysts covering the stock rate it a buy, and the high-end price target of $380 implies substantial further upside from current levels - so the debate is genuinely unresolved.

Is Trade Desk's decline permanent, or could it recover?

Not necessarily permanent. The company describes its layoffs as a structural reset rather than a sign of financial distress, revenue is still growing (albeit slowly), and it remains profitable. That said, with 8 of 38 analysts rating the stock a sell of some kind, rebuilding market confidence - and any path back into the S&P 500 - would likely require several consecutive quarters of demonstrated growth reacceleration.

Does this index swap actually affect ordinary investors?

Yes. Anyone holding a fund that tracks the S&P 500 (SPY, VOO, and similar funds) will automatically gain exposure to Bloom Energy and lose exposure to Trade Desk once the change takes effect on September 21. Conversely, funds tracking the S&P SmallCap 600 will pick up Trade Desk as a new holding.

Sources

This article is an original synthesis and analysis based on the reporting below, not a reproduction of the original articles. Please check the source articles directly for the most current figures.

⚠️ This article is for informational purposes only and is not investment advice. Market conditions change constantly - always verify the latest data before making investment decisions.