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The more the markets rise, the less investors seem to care about dividends. What's the point of getting paid a meager dividend, when you can make staggering returns by investing in the next AI highflyer?
VSDA Promises Dividend Growth, But The Numbers Say Otherwise
Summary
- VictoryShares Dividend Accelerator ETF markets itself as a dividend growth ETF, but the underlying holdings show little to no earnings growth.
- Many of the ETF's top stocks face stagnating or negative earnings growth trends and increasing dividend payout ratios.
- VSDA's monthly payouts may mask weak fundamentals and declining dividend safety, but I'm not buying it.
- The double-digit dividend growth rate seems financially engineered rather than fundamentally supported. Add the high turnover rate, and I rate it a 'Sell'.
- This late in the cycle, blindly buying into ETFs seems like a risky strategy. A deep fundamental analysis with a value bias is key.
Philipp is a seasoned value investor with nearly 20 years of experience in the field. He takes a global approach to investment opportunities, seeking out undervalued companies that offer a significant margin of safety, leading to attractive dividend yields and returns. While he does not limit his investments to specific sectors or countries, he focuses only on companies he thoroughly understands and can reasonably assess for future growth potential. Philipp is particularly enthusiastic when he identifies a company with a solid earnings track record trading at less than 8x free cash flow, which inspired his username: 8xfreecash.
Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. 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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