The Fidelity High Dividend ETF (FDVV) is an underperforming growth stock like Nvidia’s top holding, despite this surprising placement. The ETF’s strategy involves investing in dividend-paying large- and mid-cap companies expected to continue growing their dividends. This strategy has resulted in a diverse portfolio with Nvidia, Microsoft, Apple, and Broadcom as top holdings, despite their lower yields. These lower-yielding tech stocks are expected to grow their earnings over time, making them attractive for dividend investors like FDVV.
The combination of high-growth stocks like Nvidia with traditional dividend stalwarts like ExxonMobil and Chevron has led to solid performance for FDVV. The ETF has outperformed the broader market over the past three years and generated an annualized return of 11.1% over three years and 14.6% over five years. Additionally, FDVV offers a 3.0% dividend yield, above-average for ETFs, and charges a reasonable expense ratio of 0.15%.
FDVV’s holdings receive favorable ratings from TipRanks’ Smart Score system, with 7 of the top 10 holdings scoring 8 or higher. The ETF itself has an Outperform rating with a score of 8 out of 10. The strong performance of FDVV over time has attracted analyst attention, with a Moderate Buy consensus rating and an average target price of $52.32, implying an upside potential of 11.6% from current levels.
Overall, FDVV presents a compelling investment opportunity for investors looking to diversify their dividend-focused portfolios with a mix of high-yield growth stocks and traditional dividend payers. The ETF’s solid track record, strong performance, above-average dividend yield, and reasonable fees make it a good option for those seeking attractive total returns over time.
Article Source
https://finance.yahoo.com/news/fdvv-dividend-etf-where-nvidia-003651302.html