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Why Target Is a Great Dividend Stock

3 years 2 months ago
Target (NYSE: TGT) isn't known as a dividend stock, but maybe it should be. The company is growing again and once it gets past last year's inventory issues, the company's earnings should be back on track. Travis Hoium covers why he likes the stock in this video.
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WINN ETF: Can You Really Win with This ETF?

3 years 2 months ago
The aptly-named Harbor Long-Term Growers ETF ( NYSE:WINN) is an actively-managed ETF focused on long-term growth stocks that has posted a sizzling gain of nearly 40% year-to-date so far in 2023. The ETF looks promising and has a lot going for it, but there are also some factors that investors should consider carefully before deciding whether WINN is the right choice for their portfolios. Let’s dive right into it.  What is the WINN ETF? WINN is an actively-managed ETF from Harbor Capital that “seeks long-term growth of capital by employing a proprietary combination of bottom-up, fundamental research and systematic portfolio construction,” according to Harbor Capital. The team behind WINN believes that “companies with sustainable competitive advantages have the potential to drive superior levels of long-term growth and generate strong returns for shareholders,” and it’s hard to argue with this logic. The fund launched in February of 2022 and has about $175 million in assets under management (AUM). WINN's Portfolio So, what type of portfolio does this bottom-up, systematic approach create in practice? See below for an overview of WINN’s top 10 holdings using TipRanks’ holdings tool. WINN holds 73 positions, and its top 10 holdings make up 57.6% of the fund. Top holdings Apple ( NASDAQ:AAPL ) and Microsoft ( NASDAQ:MSFT ) combine to make up nearly a quarter of the fund. The rest of the top 10 is dominated by the rest of the "Magnificent Seven" tech names, which are Nvidia ( NASDAQ:NVDA ), Amazon ( NASDAQ:AMZN ), Alphabet ( NASDAQ:GOOGL ), Tesla ( NASDAQ:TSLA ), and Meta Platforms ( NASDAQ:META ). Then, Eli Lilly ( NYSE:LLY ), Visa ( NYSE:V ), and Uber ( NYSE:UBER ) make up the remaining top holdings.  This is a relatively strong portfolio, as eight of the top 10 holdings feature Smart Scores of 8 out of 10 or better. 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. WINN itself registers an impressive ETF Smart Score of 8 out of 10. Is WINN Stock a Buy, According to Analysts? Turning to Wall Street, WINN has a Moderate Buy consensus rating, as 76.64% of analyst ratings are Buys, 20.87% are Holds, and 2.49% are Sells. At $20.27, the average WINN stock price target implies 8.18% upside potential. What's Not to Like? So far, this sounds like a pretty good ETF, so what's not to like? For all the talk of bottom-up research and systematic portfolio construction, it’s hard to see real differentiation or alpha here based on WINN's portfolio. While it takes a research-heavy, active approach, WINN doesn’t look all that different from popular growth index ETFs like the Vanguard Growth ETF ( NYSEARCA:VUG) or the Schwab U.S. Large-Cap Growth ETF ( NYSEARCA:SCHG) when looking at its top holdings. WINN and VUG have 8 of the same top 10 holdings. Below, you’ll find an overview of VUG’s top 10 holdings, and if you looked at the table above showing WINN's top positions, it probably looks pretty familiar.  VUG's Top 10 Holdings Similarly, WINN and SCHG also feature 8 of the same top 10 positions. See below for SCHG's top 10 holdings. SCHG's Top 10 Holdings In fact, because the aforementioned "Magnificent Seven" stocks have grown so much in market cap this year, WINN’s top holdings look fairly similar to those of the broadest of broad market index ETFs, like the Vanguard S&P 500 ETF ( NYSEARCA:VOO) . Take a look at VOO's top 10 holdings below. VOO's Top 10 Holdings This isn't WINN's fault per se, but the level to which the Magnificent Seven stocks have grown this year makes them large components for many index funds. Because it includes these seven stocks, the challenge for WINN is that it does not offer much differentiation from these index funds. The further issue is that in addition to this lack of differentiation, it also charges a much higher expense than these funds. WINN’s expense ratio of 0.57% is orders of magnitude higher than those of VUG, SCHG (which both have expense ratios of 0.04%), or VOO (which has an even lower expense ratio of 0.03%).  So in year one, an investor initially investing $10,000 into WINN would pay $57 in fees, while an investor putting the same amount into VUG or SCHG would pay just $4. Meanwhile, an investor allocating the same amount to VOO would pay just $3. This wide gulf in fees really becomes even more pronounced over time. Assuming that fees remain the same and that each of these funds returns 5% per year over a 10-year investment horizon, the investor who initially invested $10,000 in VUG or SCHG would pay just a minuscule $51 in fees over the course of the decade. Meanwhile, the investor who allocated the same amount to VOO would pay an even lower $39 in fees, a total so low that you almost barely notice it over 10 years. However, an investor in WINN would almost certainly notice the $714 in fees they would pay for holding WINN for the same 10-year timeframe. This total is 18 times higher than the total expenses for VOO and 14 times higher than those of SCHG and VUG.  WINN's Performance Track Record As you can see, WINN doesn’t offer a lot of differentiation versus these low-cost index funds, but it is a lot more expensive than them. WINN only launched in 2022, so while its lack of a long-term track record is through no fault of its own, it can’t yet match the long-term performance track records that these popular ETFs have compiled for many years. For example, SCHG has beaten the market with a stellar 15.7% total annualized return over the past years, while VUG posted an impressive 14.9% total annualized return over the same time frame. The S&P 500 fund, VOO, has a total annualized return of 12.8% over the same time period. WINN may certainly one day be able to make this same case for itself, but for now, it will take a while before it can match the long-term track record of its more established growth counterparts.  Conclusion WINN looks like a solid ETF with a sound strategy, a favorable rating from analysts, and even an outperform-equivalent Smart Score. There isn’t really much of an issue with the ETF itself, and it could well be an ETF to keep an eye on in the future. However, for now, it’s hard to really see a compelling reason to invest in WINN ahead of larger, more established ETFs like VUG and SCHG, which offer much of the same exposure at a far lower cost and with a longer track record of results under their belts. Disclosure
TipRanks

Better Buy: Costco vs. Amazon Stock

3 years 2 months ago
Investors have vastly different ideas about Costco Wholesale (NASDAQ: COST) and Amazon (NASDAQ: AMZN) stocks right now. The e-commerce giant's shares are beating the market by a wide margin through mid-July, while the warehouse retailer is barely matching the 17% gain in the S&am
The Motley Fool

Validea Detailed Fundamental Analysis - AMZN

3 years 2 months ago
Below is Validea's guru fundamental report for AMAZON.COM, INC. (AMZN). Of the 22 guru strategies we follow, AMZN rates highest using our P/B Growth Investor model based on the published strategy of Partha Mohanram. This growth model looks for low book-to-market stocks that exhi
Validea

The Smartest Stocks to Buy With $20 Right Now and Hold Forever

3 years 2 months ago
At the end of last year, there were a lot of good stocks trading below $20 per share as the market endured a difficult bear retreat and brought down the prices of a lot of good stocks. But a surging stock market in 2023, particularly in the technology sector, has moved a lot of t
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Truist Financial: A New Bank for a New Era

3 years 2 months ago
When BB&T and SunTrust merged at the end of 2019, it created a top 10 U.S. bank called Truist Financial (NYSE: TFC) that many analysts thought had considerable commercial real estate (CRE) exposure. The collapse of Silicon Valley Bank and Signature Bank in early March aggrava
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