Top-Ranked Value ETFs & Stocks You'll Be A Fool To Ignore
Zacks Investment Research | Apr 01, 2019 01:00AM ET
Investors are fearing an imminent recession in the United States and the Fed has cut its 2019 and 2020 growth forecast. However, the S&P 500 has just seen the : Is Market Overvalued? 5 Cheap Top-Ranked ETFs to Play ).
Where Lies Those Hidden Gems?
Per an article published on seekingalpha, “value stocks are now lie in the value segment .
Sanford C. Bernstein also recommended value shares despite their persistent underperformance. Investors should note that the Russell 1000 Value Index has underperformed the Russell 1000 Growth Index over the past 12 years .
The said, the hedge fund manager pointed out that both the Stoxx Europe 600 Index and MSCI Europe Value Index are trading below long-term averages on a price-to-earnings basis and are yet to regain levels seen before the fourth-quarter sell-off. This calls for a buying opportunity especially with an accommodative ECB.
Why Value ETFs May Gain in 2019?
A pool of global worries leads us to believe that U.S. stocks are expected to be stable in the near term but choosing a value investment is a great idea at the current level given a host of tensions, including uncertainty regarding the trade war and slowdown in developed economies like the Euro zone and Japan as well as political uncertainty pertaining to Brexit.
Investors are even apprehensive of an economic recession in the United States, meaning the zone is also not risk-free. U.S. value funds may have underperformed the growth ones in a rising rate environment in 2018, but rates in the United States are likely to remain low in 2019 as the Fed has signaled that it will remain dovish this year.
Though there were signs of improvement in 2019, U.S.-China trade tensions are not resolved yet. Even if the duo manages to strike a deal, the hope is currently priced in at the current level. Some analysts are of the view that any real deal appears as a 'sell the news' opportunity for investors right now.
Top Value ETF & Stock Picks
Against this scenario, we highlight a few top-ranked value ETFs and stocks that can be good income-earners over the medium term.
ETF Picks
iShares Russell 1000 Value ETF (NYSE:WD)
The 721-stock fund follows the Russell 1000 Value Index and measures the performance of the large-capitalization value sector of the U.S. equity market. It charges 20 bps in fees. The fund has a Zacks ETF Rank #1 (Strong Buy) (read: Q1 ETF Asset Report: Emerging Markets Win ).
O'Shares FTSE US Quality Dividend ETF OUSA
The underlying index of the fund – the FTSE US Qual / Vol / Yield Factor 5% Capped Index –measures the performance of publicly-listed, large-capitalization and mid-capitalization dividend-paying issuers in the United States. It charges 48 bps in fees and has a Zacks ETF Rank #1 (read: Top-Ranked Dividend ETFs Crushing the Market ).
Get The News You Want
Stock Picks
Foot Locker Inc. (NYSE:FL)
Headquartered in New York City, the company is a leading global retailer of athletically inspired shoes and apparel. The stock has a Zacks Rank #1 and a top Value Score of A. The stock also has a low forward P/E ratio of 11.65x.
Walker & Dunlop Inc. (NYSE:WD)
The Zacks Rank #1 company is engaged in providing commercial real estate financial services in the United States, with primary focus on multifamily lending. It comes from a top-ranked Zacks industry (top 39%). It has a Value Score of A and a forward P/E ratio of 9.43x.
Want key ETF info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week. Zacks Investment Research
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.