Key Points

• Sandisk officially becomes an S&P 100 company on Monday, Sept. 21, along with Dell Technologies, Palo Alto Networks, and Arista Networks.

• Sandisk shares have risen more than 600% in 2026, more than any other stock in the S&P 500.

• The money tracking the S&P 100 is small compared to the money tracking the S&P 500, which Sandisk joined last November.

• 10 stocks we like better than Sandisk ›

On Monday, Sept. 21, Sandisk (NASDAQ:SNDK) takes a spot in the S&P 100, a subset of the S&P 500 (SNPINDEX:^GSPC) made up of 100 of its largest blue-chip companies. Dell Technologies, Palo Alto Networks, and Arista Networks enter with it. The announcement came from S&P Dow Jones Indices on Sept. 4, and the changes take effect before Monday's open.

Four companies are leaving to make room: Nike (NYSE:NKE), Colgate-Palmolive, Simon Property Group, and Honeywell Aerospace.

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The swap says a lot about how 2026 has gone. Sandisk shares have gained more than 600% this year, more than any other stock in the S&P 500.

Nike's stock, meanwhile, reached a 52-week low this week. And Sandisk, worth about $260 billion, is currently more than four times the size of the roughly $54 billion sportswear giant.

Still, an index milestone and an investment case are two different things. Here's what Monday's change does for Sandisk's stock -- and what it doesn't.

How much buying does the change force?

When a stock enters an index, the funds tracking that index have to buy it. After all, that mechanical demand is the reason index additions attract investors' attention in the first place.

But Sandisk's pool of forced buyers is smaller than it might seem. The company already belongs to the S&P 500, so the giant funds tracking that benchmark own the stock. That leaves the funds tracking the S&P 100 specifically, and they generally do their buying at Friday's close, just before the change takes effect.

And that pool is modest. iShares' S&P 100 fund holds about $20 billion. The same firm's core S&P 500 fund holds about $837 billion, and it's one of several very large funds tracking that benchmark.

Run the numbers, and the buying looks even smaller. If Sandisk lands at a weight of about half a percent of the S&P 100, the iShares fund would require about $100 million of stock.

For a stock this heavily traded, the amount is small. More than $15 billion of Sandisk stock has changed hands on a normal day recently, so the index demand could disappear into a single day's trading.

The rally was driven by the business

Sandisk cleared the far bigger index hurdle on Nov. 28, when it entered the S&P 500. Shares closed 2025 at $237.38. The more than sevenfold gain since then, I think, had little to do with index funds.

Sandisk sells NAND flash memory, the storage chips inside data centers, phones, and laptops. And its fiscal 2026, which ended July 3, was exceptional. The year brought in $20.25 billion of revenue, up 175% year over year, led by a 437% surge in data center revenue. Net income reached $11.4 billion, compared with a $1.6 billion loss the year before.

The fiscal fourth quarter alone generated $8.97 billion of revenue, up 372% year over year, and the company attributed about two-thirds of its sequential growth to higher prices, not higher volumes.

Memory prices still set the direction

That growth engine is still running, but it's slowing down. Sequential revenue growth was 97% in fiscal Q3, then 51% in fiscal Q4. Management's guidance for fiscal Q1 2027 puts revenue between $10.3 billion and $10.8 billion, which works out to growth of about 18% from fiscal Q4. Still strong, but a clear deceleration.

Margins may be topping out, as well. Non-GAAP (adjusted) gross margin was 78.4% in fiscal Q3 and 84.6% in fiscal Q4, and management guided to 83% to 85% for the current quarter.

The stock changes hands around $1,800 as of this writing, after an 11% jump Friday -- about 24 times earnings. That price-to-earnings multiple seems reasonable, but the bulk of those earnings arrived in the past two quarters, when memory prices were rising sharply.

If pricing holds, that price-to-earnings multiple could prove conservative. If pricing falls, earnings could fall with it. And the stock has already shown it can move both ways, sitting about 24% below the high of $2,354.39 it reached in June.

Ultimately, Monday is worth marking, but little more. The forced buying is small, the bigger index event came and went last November, and the company's own guidance calls for slowing growth.

Sandisk earned its spot among the mega caps. But what the stock does from here still depends on memory prices, not membership. I'll view Monday's move as a milestone worth noting, not a reason to buy.

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Daniel Sparks and his clients do not have positions in any of the stocks mentioned. The Motley Fool has positions in and recommends Arista Networks, Colgate-Palmolive, Honeywell Aerospace, Nike, and Simon Property Group. The Motley Fool recommends Palo Alto Networks. The Motley Fool has a disclosure policy.