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MANHATTAN BEACH, Calif.--(BUSINESS WIRE)--Cambria Investment Management today marked the 10-year anniversary of the Cambria Emerging Shareholder Yield ETF (EYLD).
If you own SPDR S&P 500 ETF Trust (NYSEARCA:SPY) or a similar low-cost S&P 500 index fund, you own the U.S.
Despite continued concentration in mega-cap technology stocks, US dividend-focused strategies have generally remained competitive and historically experienced more shallow drawdowns than broader equity markets. Last year, US companies paid a record US$704.8 billion in dividends - the 15th consecutive annual record. Concurrently, dividend growth accelerated across several international markets, highlighting the continued strength of shareholder-return trends.
Cambria Shareholder Yield ETF (SYLD) employs a shareholder yield strategy, emphasizing dividends, buybacks, and debt paydown, resulting in deep value exposure. SYLD is overweight energy, consumer discretionary, and financials, but underweight technology, industrials, and real estate, leading to modest growth and profitability metrics. At a 10.9x P/E, SYLD trades at a significant discount to the S&P MidCap 400 and peers, but its growth (-3.2% earnings, 0.5% sales) and profitability (12.5% ROE) lag benchmarks.
The Cambria Shareholder Yield ETF targets U.S. stocks with high shareholder yield, combining dividends, buybacks, and debt paydowns using a quantitative approach. SYLD's portfolio is diversified across 99 small- and mid-cap stocks, with notable exposure in financials, consumer discretionary, energy, and materials, and strong value characteristics. SYLD has outperformed the S&P MidCap 400 benchmark since 2013 and several peer ETFs since 2017, though with higher volatility and a relatively high 0.59% expense ratio.
SYLD is one of Cambria's Total Shareholder Yield ETFs, offering exposure to 100 companies with high combinations of dividends, buybacks, and debt retirement. Its expense ratio is 0.59%. SYLD was one of the worst-performing funds over the last year, and my fundamental analysis reveals the likely source is its substantial exposure to the size and value factors. In contrast, its growth rates are extremely poor, and with S&P 500 Index sales and earnings surprises still solid, this lack of exposure to the growth factor matters.
Cambria Shareholder Yield ETF holds 100 stocks with high shareholder yield, a factor combining dividends, buybacks and debt reduction. SYLD is focused on small and mid-caps, with significant exposure in consumer discretionary and financials. SYLD has strong value characteristics and has outperformed a mid-cap benchmark since inception, even though it has lagged for 12 months.
Meb Faber talks to Kirk Spano about shareholder yield, ETFs, and what tends to happen at the end of secular booms. A slightly less strong USD and foreign and emerging markets.