OUSA: A High-Priced Dividend ETF That Fails To Stand Out

Summary

  • OUSA is a portfolio of 100 dividend-paying U.S. stocks purported to have superior profitability, dividend growth, revenue growth, balance sheet, and low-volatility features.
  • However, the low starting yield of approximately 1.83% means OUSA as an income investment isn't a viable choice. Impacting this yield is an unreasonable 0.48% expense ratio.
  • OUSA definitely holds high-quality stocks, but the other aforementioned features aren't unique at all in the dividend ETF space. This article suggests two cheaper and better alternatives.
  • I also dislike OUSA's lack of valuation screen. While it should continue to perform well in the current defensive environment, it's clearly not the best choice.
  • Looking for a portfolio of ideas like this one? Members of Hoya Capital Income Builder get exclusive access to our subscriber-only portfolios. Learn More »

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Investment Thesis

The O'Shares U.S. Quality Dividend ETF (BATS:OUSA) selects 100 of the highest-quality U.S. companies making sustainable dividend payments. Unfortunately, many other cheaper dividend ETFs follow this same strategy, so OUSA fails to stand out and its

OUSA Fund Details

ALPS Funds

OUSA Methodology

O'Shares Investments

SPY vs. DGRO vs. DGRW vs. OUSA Sector Exposures

Morningstar

OUSA Top Ten Holdings

ALPS Funds

OUSA vs. DGRO vs. DGRW Performance

Portfolio Visualizer

OUSA vs. DGRO vs. DGRW Performance

Portfolio Visualizer

OUSA Fundamentals

The Sunday Investor

OUSA Dividend Fundamentals

The Sunday Investor

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This article was written by

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Build sustainable portfolio income with premium dividend yields up to 10%.

I'm a data-driven ETF analyst who likes to do deep dives into how funds are constructed and what factors are likely to make them winners or losers. I have a database of over 700 ETFs that I follow, so I'm able to show readers the best- and worst-performing funds in each category with each one I review. My preference is for stocks to have strong cash-generating and debt management qualities. I welcome all questions, comments, and suggestions for improvement, and I enjoy my time engaging with the Seeking Alpha community.

I hold a Bachelors degree in Commerce with a major in Accounting and hold a Certificate in Advanced Investment Advice from the Canadian Securities Institute. I have also completed the Portfolio Management Techniques course, fulfilling the educational requirements for a Chartered Investment Manager (CIM) designation. I have passed CFA Level 1, and I am currently studying to become licensed to advise on options and derivatives in Canada. This past November, I became a contributor for the new Hoya Capital Income Builder Marketplace Service, and enjoy working with and sharing ideas with some of the best researchers on Seeking Alpha. Sign up for a free trial today! Hoya Capital Income Builder.

Disclosure: I/we have a beneficial long position in the shares of SPY, MSFT either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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