COWZ provides consistent exposure to 100 high-quality U.S. stocks trading at cheap valuations, as measured by free cash flow yield. COWZ's recent returns have been disappointing, and over the last year, it's been one of the worst-performing cash-flow-focused funds on the market. This article lists the 15 others I track. High quality is COWZ's current advantage, but my fundamental analysis reveals its peers generally offer a better growth and value combination. Notably, VFLO is superior to COWZ on both metrics.
COWZ: Low Valuation, Alternative Sector Exposure
I'm upgrading COWZ from hold to buy, citing improved risk/reward and a modest valuation after recent underperformance versus the S&P 500. Health Care is now the largest sector weight in COWZ, and its cheap valuation and strengthening technicals could drive future outperformance. COWZ trades at just 13.6x earnings with a low PEG ratio, offering value exposure, though share momentum and historical volatility remain concerns.
The Pacer US Cash Cows 100 ETF (COWZ) made its debut on 12/16/2016, and is a smart beta exchange traded fund that provides broad exposure to the Style Box - Large Cap Value category of the market.
If you're interested in broad exposure to the Large Cap Value segment of the US equity market, look no further than the Pacer US Cash Cows 100 ETF (COWZ), a passively managed exchange traded fund launched on 12/16/2016.
COWZ focuses on high free cash flow yields, a basic value investing strategy which has rewarded me greatly over the decades. As a value investor, I'm attracted to so-called cash cows, mature businesses that deliver reliable cash flows which are distributed to shareholders in the form of dividends or buybacks. While I approve of the strategy, I dislike COWZ's execution. With a turnover rate close to 100%, the ETF replaces nearly all its holdings once a year.
The Pacer US Cash Cows 100 ETF (COWZ) made its debut on 12/16/2016, and is a smart beta exchange traded fund that provides broad exposure to the Style Box - Large Cap Value category of the market.
Designed to provide broad exposure to the Large Cap Value segment of the US equity market, the Pacer US Cash Cows 100 ETF (COWZ) is a passively managed exchange traded fund launched on 12/16/2016.
COWZ's Index reconstituted after the close of business Friday, resulting in 73/100 substitutions in its biggest quarterly shakeup on record. Overall, I'm pleased with the changes. COWZ now holds higher quality stocks with better sales and earnings growth potential, and the slight sacrifice in value was well worth it. Still, COWZ's high turnover rate confirms the sensitivity of its free cash flow yield screen. Substituting two-thirds of your holdings in three months isn't normal for the typical value investor.
COWZ is recommended as a defensive ETF due to its focus on high free cash flow yield, offering resilience and dividend growth in uncertain markets. Despite a slight decline in price, COWZ's strategy has shown better resilience compared to SPY and QQQ, making it attractive for accumulation. COWZ's limited tech exposure may lead to underperformance if tech continues to grow, but it remains a strong defensive addition to a diverse portfolio.
Making its debut on 12/16/2016, smart beta exchange traded fund Pacer US Cash Cows 100 ETF (COWZ) provides investors broad exposure to the Style Box - Large Cap Value category of the market.
The Pacer US Cash Cows 100 ETF (COWZ) was launched on 12/16/2016, and is a passively managed exchange traded fund designed to offer broad exposure to the Large Cap Value segment of the US equity market.