Darktrace (LON: DARK) and Vistry Group (VTY) Contending For FTSE 100 Inclusion

The FTSE 100, the index representing the 100 largest companies listed on the London Stock Exchange, has its rebalancing coming tomorrow (with data used from close of markets today). Adjustments to the index occur quarterly, reflecting changes in market capitalizations among UK-listed companies.

The tech company Darktrace, renowned for its cybersecurity solutions, is poised to join the FTSE 100 index, having had a 98% surge in its share price over the past year. The upward trajectory of Darktrace shares (LON: DARK) may be further bolstered by the recent confirmation that it has agreed to a takeover by the US private equity firm Thoma Bravo, a deal which is expected to be finalized by year-end.

Financial performance on the 6 months ending 31st December 2023 show 27.4% in revenue growth year-on-year along with a 12.9% increase in customers. The UK's leading tech firm falling into US private equity hands has put some on alert about the state of London listings however.

Joining Darktrace in the spotlight is Vistry Group, another contender for promotion into the FTSE 100.

The home construction company has enjoyed a 67% increase in its stock price over the past 12 months, paired with solid financial results and a £580million new homes deal announced today.

While Darktrace's achievement hinges on its share price appreciation and the Thoma Bravo deal, Vistry's performance is backed by consistently positive results and a favourable P/E ratio, which indicates that the stock may not be overvalued at its current price.

There are arguments for and against investing in these companies, but usually companies that are accepted into the FTSE 100 will find additional liquidity as a result of the higher volumes of trading.

The potential entrance of Darktrace and Vistry Group into the FTSE 100 will likely come at the expense of Ocado and St James Place. As new names join the ranks of the UK's most prestigious companies, the level of scrutiny can be expected to intensify.