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Better Buy: Amazon vs Apple

3 years ago
Many investors may own Amazon (NASDAQ: AMZN) and Apple (NASDAQ: AAPL) in their portfolios but may have a difficult time choosing which stock is a better buy right now. These are both dominant businesses in their respective industries with great growth prospects, so either stock w
The Motley Fool

1 Green Flag for Apple in 2023, and 1 Red Flag

3 years ago
Apple (NASDAQ: AAPL) hasn't had the easiest 2023, with its stock falling 12% since the start of August. Three consecutive quarters of revenue declines have concerned investors as the company continues to fight against macroeconomic headwinds.
The Motley Fool

Can PayPal Stock Hit $70 by the End of 2023?

3 years ago
To say that PayPal Holdings (NASDAQ: PYPL) stock has disappointed investors the past two years would be a major understatement. At recent prices, shares of the leader in electronic payments are more than 80% below their all-time high. And they trade at a dirt cheap trailing price
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SCHX ETF: A Large-Cap ETF for Large Gains

3 years ago
The Schwab U.S. Large-Cap ETF ( NYSEARCA:SCHX) stands out as an attractive investment opportunity for its minimal fees, diversified portfolio of large-cap, blue-chip U.S. stocks, and the solid returns it has generated over the years. Therefore, let’s take a look at this $32.8 billion large-cap fund from Charles Schwab ( NYSE:SCHW ).  What is the SCHX ETF’s Strategy? Charles Schwab explains that SCHX’s “goal is to track as closely as possible, before fees and expenses, the total return of the Dow Jones U.S. Large-Cap Total Stock Market Index.” Doing this gives investors “simple access to the 750 largest U.S. companies as ranked by full market capitalization.” SCHX's Holdings One thing that I really like about the Schwab U.S. Large-Cap ETF is that it offers investors real diversification. One way that SCHX does this is by holding positions in 755 stocks. However, many funds own a lot of stocks but are less diversified than this would imply because their top holdings account for a large portion of the fund, often greater than 50% or even higher. That isn’t the case at all with SCHX, which offers true diversification in that its top 10 holdings account for just 28.4% of the fund. By holding an extra 250 or so stocks, SCHX also offers a bit more diversification than the typical S&P 500 ( SPX ) fund. Below, you’ll find an overview of SCHX’s top 10 holdings using TipRanks’ holdings tool. As its name implies, SCHX’s top 10 holdings consist of blue chip, large-cap U.S. stocks like Apple ( NASDAQ:AAPL ), Microsoft ( NASDAQ:MSFT ), Amazon ( NASDAQ:AMZN ), Nvidia ( NASDAQ:NVDA ) and Alphabet ( NASDAQ:GOOG ) ( NASDAQ:GOOGL ). While SCHX is not a tech ETF, its top holdings currently skew heavily toward technology because these are the largest stocks in the market right now.  But once you get outside of these top holdings, SCHX owns plenty of non-tech names, and its holdings run the gamut of the U.S. economy. In fact, breaking it down by sector, technology accounts for just 28% of SCHX's holdings. Healthcare is the fund's second-largest sector with a weighting of 13.3%, and the sector is well-represented through the likes of UnitedHealth ( NYSE:UNH ), Eli Lilly ( NYSE:LLY ) and Johnson & Johnson ( NYSE:JNJ ). Financials come in third with a 12.7% weighting and include stocks like Berkshire Hathaway ( NYSE:BRK.B ), JPMorgan Chase ( NYSE:JPM ), Visa ( NYSE:V ), and Mastercard ( NYSE:MA ). This well-rounded group of holdings enables investors to harness the power of a large portion of the U.S. economy in their portfolios using one ETF.  Is SCHX Stock a Buy, According to Analysts? Turning to Wall Street, SCHX earns a Moderate Buy consensus rating based on 606 Buys, 138 Holds, and 11 Sell ratings assigned in the past three months. The average SCHX stock price target of $61.05 implies 20.4% upside potential. Get Smart While Wall Street analysts are bullish on SCHX, so is TipRank’s Smart Score system. The Smart Score is a proprietary quantitative stock scoring system created by TipRanks. It gives stocks a score from 1 to 10 based on eight market key factors. A score of 8 or above is equivalent to an Outperform rating. SCHX features an Outperform-equivalent ETF Smart Score of 8. Long-Term Performance  In addition to its strong portfolio of diversified holdings, favorable consensus rating from analysts, and Outperform-equivalent Smart Score, SCHX also has a solid track record of long-term performance.  Over the past three years, SCHX has had an annualized return of 9.9% (as of the end of August). Over the past five years, SCHX’s annualized return stands at 10.8%, and over the past 10 years, it comes in at an even better 12.6%.  These results are roughly on par with those of the broader market over time, albeit trailing them by a narrow margin. The SPDR S&P 500 ETF ( NYSEARCA:SPY) , a good representation of the S&P 500 index, has returned 10.4% over the past three years, 11.0% over the past five years, and 12.7% over the past 10 years. While SPY narrowly beats SCHX over these time frames, the difference is relatively marginal (amounting to a 0.1% difference annualized over 10 years), and both ETFs have generated great returns for their investors.  Below, you'll find a comparison of SCHX and SPY using TipRanks' ETF comparison tool, which allows investors to compare up to 20 ETFs at a time based on a wide variety of customizable factors. Tiny Expense Ratio SCHX is notable for its minuscule expense ratio of just 0.03%, which is just about as low as you will find in today’s market. This ultra-low expense ratio means that an investor putting $10,000 into SCHX would pay just $3 in fees during their first year of investing in the fund.  The effect of these savings really adds up over time. Assuming the fund returns 5% a year going forward and the expense ratio remains 0.03%, after three years, this same investor would pay just $10 in fees. After five years, this investor would pay just $17 in fees, and over the course of a decade, this investor would pay just a paltry $39 in fees. Investing in low-cost funds like SCHX is key for preserving the principal value of your portfolio over time.  Dividend Payout It should also be noted that SCHX is a dividend payer. While SCHX's dividend yield of 1.5% isn't enough to put it on the radar of income investors, it still adds to total returns over time. Furthermore, SCHX has been paying its holders a dividend for 13 consecutive years, and there is plenty of room for this dividend payout to grow over time as the companies it owns grow their earnings and increase their own payouts over the years. Investor Takeaway Ultimately, SCHX is an attractive option for investors to consider adding to their investment portfolios. The fund has produced double-digit annualized returns over the past decade. Additionally, it features a negligible expense ratio, and it gives investors plenty of diversification, both in terms of the large number of stocks that it holds and its low concentration towards its top 10 holdings. Lastly, SCHX also enjoys a favorable outlook from analysts and an outperform-equivalent Smart Score from TipRanks. Altogether, there are plenty of reasons to like this ETF. Disclosure
TipRanks

IYW ETF: A Long-Term Winner in the Tech Sector

3 years ago
Looking for a long-term winner in the tech sector? Look no further than The iShares U.S. Technology ETF ( NYSEARCA:IYW) . Not only has this $10.7 billion tech ETF from BlackRock's ( NYSE:BLK ) iShares posted double-digit annualized returns for years, but as of the end of the most recent month, it sported an annualized return of over 20% over the past decade. Therefore, let’s take a closer look at this powerhouse tech ETF.  What is the IYW ETF’s Strategy? IYW seeks to give investors “targeted access to domestic technology stocks” by investing in U.S.-based information technology, electronics, and computer software and hardware companies.   IYW's Long-Term Track Record As discussed above, IYW has put up phenomenal results over the years. As of the end of August, IYW returned 12.2% on an annualized basis over the past three years. Looking further out, the fund’s five-year return is an even more impressive 18.6% on an annualized basis. Going all the way out to 10 years, IYW has generated a stellar 20.2% return on an annualized basis.  Looking at things cumulatively, IYW’s 10-year return was an incredible 544.2%, meaning that an investor who put $10,000 into the fund 10 years ago would have a stake worth $64,420 as of the end of August.   These results soundly beat those of the broader market over the same time frame. For example, the Vanguard S&P 500 ETF ( NYSEARCA:VOO) has returned 10.5% annualized over the last three years, 11.1% annualized over the past five years, and 12.8% over the past decade.  At the same time, IYW’s results are roughly on par with those of some of the market’s biggest and most well-known tech ETFs, the Technology Select Sector SPDR ETF ( NYSEARCA:XLK) and the Invesco QQQ Trust ( NASDAQ:QQQ) . XLK’s annualized returns over the past three, five, and 10 years stand at 13.4%, 19.7%, and 20.5%, respectively, just a hair above IYW’s over each time frame. Meanwhile, IYW has slightly outperformed QQQ over each of the same time frames. QQQ’s annualized returns over the past three, five, and 10 years come in at 9.3%, 16.0%, and 18.6%, respectively.  At the end of the day, these are all great ETFs, and IYW is right there in the mix with them. Below, you’ll find a comparison of IYW, QQQ, and XLK using TipRanks’ ETF comparison tool, which gives investors the ability to compare ETFs on a variety of customizable factors. IYW's Holdings With 137 holdings, IYW offers decent diversification. However, the fund is also fairly concentrated in that its top 10 holdings account for 63.2% of assets. Below, you’ll find an overview of IYW’s top 10 holdings using TipRanks’ holdings tool. As you can see, the fund’s largest two holdings, Apple ( NASDAQ:AAPL ) and Microsoft ( NASDAQ:MSFT ), combine to make up over one-third of the fund’s assets. The two classes of Alphabet ( NASDAQ:GOOG ) ( NASDAQ:GOOGL ) shares also combine to make up over 10% of the fund.  What I like about IYW’s overall group of holdings is that it gives investors a nice mix of exposure to all aspects of the technology sector. About 40.9% of IYW’s holdings fall under the software and services subsector, and 21.8% are classified as semiconductors and semiconductor equipment. Another 20.9% are classified as tech hardware and equipment, while media and entertainment accounts for a 14.9% weighting.  This allows investors to tap into the full range of what the tech sector has to offer, whether it’s semiconductor giants like Nvidia ( NASDAQ:NVDA ) and Broadcom ( NASDAQ:AVGO ), enterprise software providers like Oracle ( NYSE:ORCL ) and Salesforce ( NYSE:CRM ), or multifaceted tech behemoths like Alphabet and Meta Platforms ( NASDAQ:META ).   Collectively, IYW’s top holdings are the owners of some strong Smart Scores. The Smart Score is a proprietary quantitative stock scoring system created by TipRanks. It gives stocks a score from 1 to 10 based on eight market key factors. A score of 8 or above is equivalent to an Outperform rating. Seven of IYW’s top 10 holdings feature Smart Scores of 8 or above, led by Nvidia and Broadcom, which have 'Perfect 10' Smart Scores. IYW itself has an Outperform-equivalent ETF Smart Score of 8. Is IYW Stock a Buy, According to Analysts?  Turning to Wall Street, IYW earns a Moderate Buy consensus rating based on 109 Buys, 27 Holds, and one Sell rating assigned in the past three months. The average IYW stock price target of $126.63 implies 20.9% upside potential. Expense Ratio Outside of the high concentration in its top holdings, the only real negative of IYW is its expense ratio. While its expense ratio of 0.40% is reasonable, it’s also higher than those of comparable ETFs like the aforementioned QQQ and XLK, which charge 0.20% and 0.10%, respectively.  An investor allocating $10,000 into IYW would pay $40 in fees and expenses during their first year of investing versus $20 for an investor putting the same amount into QQQ or $10 for a $10,000 investment in XLK. While these are all reasonable amounts, IYW is the most expensive of the group. The difference in fees would also compound over time. Assuming that each fund returns 5% per year going forward and that each maintains its current expense ratio, the IYW investor would pay $505 in fees over the course of 10 years, versus $128 for the XLK investor and $255 for the QQQ investor.  When a fund is returning 20% or more on an annualized basis, this might not be a major consideration, but it’s still something that investors should be aware of.  Investor Takeaway Ultimately, IYW is another top tech ETF that has proven itself as a long-term winner. The fund has achieved excellent annualized returns of over 20% over the past 10 years, creating significant long-term wealth for its investors in that time. Also, the ETF gives investors broad exposure to all facets of the U.S. technology sector while having an Outperform-equivalent ETF Smart Score of 8 and a Moderate Buy rating from analysts. The only real downside is its expense ratio, which while reasonable, is higher than those of its larger competitors. Nonetheless, IYW's long-term performance and proven track record make it a solid choice for investors to consider adding to their portfolios. Disclosure
TipRanks

How Verizon and AT&T Can Upend Cable TV

3 years ago
The cable industry has lost about 25 million subscribers over the last five years and cord-cutting seems to be accelerating. The bundle that drove record profits for media companies is evaporating before our eyes. But that doesn't mean media is going anywhere and with streaming p
The Motley Fool

Microsoft executive says Google deals kept Bing small

3 years ago
A Microsoft executive testified on Thursday that Apple and other smartphone makers turned down revenue sharing agreements that would have helped his company's Bing search engine - keeping Google in its dominant position on those devices as the default search engine.
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