What happened

Shares of the insurance platform SelectQuote (SLQT 3.06%) rose more than 11% today after it was announced that the company would join the S&P SmallCap 600 Index.

So what

The S&P SmallCap 600 covers U.S. small-cap stocks with market capitalizations ranging from $700 million to $3.2 billion at the time the company is added to the index. SelectQuote currently has a market cap of roughly $3.5 billion, although that's after its recent bump today.

Stocks tend to appreciate when they are added to an index because funds that track the index must now buy the stock. Also, being added to an index results in greater visibility for the stock.

Green squiggly line moving in upward direction.

Image source: Getty Images.

Now what

SelectQuote has struggled to gain much traction since going public in May of 2020, with shares currently down more than 18% from the day the company listed.

However, whether on a three- or nine-month basis for the period ended March 31, profits are growing in terms of diluted earnings per share. Additionally, revenue is up tremendously under both time periods as well.

The company did revise its net income range downward for the full year at the end of the first quarter, but the revision was small and solely done so the company can continue to invest in growth, so this looks like an opportune time to buy the stock.