S&P 100 ETF Replaces Nike and Colgate with 4 AI Stocks: What the Overhaul Means for Index Investors

The iShares S&P 100 ETF (OEF) announced a comprehensive rebalancing on September 6 and 7, 2026, effective September 21, 2026. Four established companies will exit the index, while four tech companies focused on AI infrastructure will move in.

Nike (NYSE: NKE), Colgate-Palmolive (NYSE: CL), Simon Property Group (NYSE: SPG) and Honeywell Aerospace (NASDAQ: HON) are exiting the S&P 100. They are being replaced by Dell Technologies (NYSE: DELL), Palo Alto Networks (NASDAQ: PANW), Arista Networks (NYSE: ANET) and SanDisk (NASDAQ: SNDK).

Historic Decline: Nike Leaves S&P 100 After 18 Years

Nike is exiting the S&P 100 after 18 years as an index constituent. The sportswear company lost more than $220 billion in market value over a five-year period, with the stock declining 78%. According to reports from September 6, 2026, it is a "collapse for the history books".

Despite its exclusion from the S&P 100, Nike remains listed in the broader S&P 500 index. At the time of the June rebalancing snapshot, Nike accounted for just 0.11% of the OEF fund. Colgate-Palmolive represented 0.16%. Together, both companies represented just 0.27% of the portfolio – they had already become negligible positions before the official exclusion.

Four AI Infrastructure Stocks with Three-Digit Gains

The four new additions share a focus on AI infrastructure and spectacular gains in the current year. According to data from September 6 and 7, 2026, they posted the following performance:

• SanDisk: +633% year to date, price near $1,740
• Dell Technologies: +320.24% year to date
• Palo Alto Networks: +80.92% year to date
• Arista Networks: +47.89% year to date

The four companies cover different segments of AI infrastructure: Dell supplies AI servers, Palo Alto Networks offers AI security solutions, Arista Networks provides AI networking technology, and SanDisk produces AI storage components.

All four stocks are being promoted from the broader S&P 500 into the more exclusive S&P 100 – they are not new entrants to the index system, but rather moving up within the S&P hierarchy.

How Index Methodology Limits Actual Impact

The S&P 100 weights its members by free-float market capitalization. According to S&P Global's methodology, new additions typically enter the index at the lower end of the weighting scale, not as equally weighted positions. Dell, Palo Alto Networks, Arista Networks, and SanDisk will therefore not fundamentally change the composition of the OEF overnight, despite their significant gains.

The index committee's decisions follow market capitalization and ratify a shift that the market has already completed. The inclusion of the AI stocks reflects price movements that have already occurred, rather than proactively initiating a sector shift.

OEF Performance Lags Behind Tech Indices

Through September 7, 2026, the OEF achieved 12% performance year to date. This means the fund significantly lagged other index products: The Invesco QQQ Trust (QQQ) – an index focused on the 100 largest non-financial Nasdaq companies – gained 17% in the same period, while the Vanguard S&P 500 ETF (VOO) gained 14%.

At the same time, the OEF charges an expense ratio of approximately 0.20%, roughly four times the typical fees of VOO. Investors are therefore paying significantly more for a strategy that underperformed this year.

What Does the Overhaul Mean for Investors?

The rebalancing raises fundamental questions about the OEF's strategic direction. The fund is marketed as "diversified mega-cap exposure". However, the repeated addition of AI and tech stocks raises the question of whether the OEF has silently reformed around a single theme and become a "somewhat cheaper, somewhat diluted cousin of the Invesco QQQ Trust".

The current rebalancing is not an isolated event. On March 6, 2026, the S&P 100 already added semiconductor and technology stocks Micron Technology (MU), Lam Research (LRCX), Applied Materials (AMAT) and GE Vernova (GEV) as part of the AI boom. The index composition is thus continuously shifting toward technology and AI-focused companies.

For passive investors who invest in the 100 largest U.S. companies through the OEF, the rebalancing does not require immediate action. The index fund automatically adjusts its portfolio. However, investors should review whether the increasing concentration on AI infrastructure and tech stocks still aligns with their original diversification goals – or whether the fund's composition now more closely resembles a tech index than a broadly diversified mega-cap portfolio.