Capital Group Dividend Value ETF

CGDV

Market cap $27.2B

Dividend investing is increasingly vital amid higher rates and inflation, offering passive income and wealth compounding for retirement. Anchoring a portfolio with quality dividend ETFs like SCHD, FDVV, or CGDV can provide reliable income and potential outperformance. Combining high dividend growers (e.g., V, MA, WM) with stable high-yielders (e.g., VZ, O, ADC, STWD) balances growth and income.

Capital Group Dividend Value ETF is rated a strong buy with a $52 price target, implying 20% upside. CGDV has outperformed the S&P 500, delivering a 96% total return over three years, driven by high-momentum value stock selection. The portfolio is heavily weighted toward technology, industrials, and healthcare, positioning CGDV to benefit from projected sector earnings growth in 2026.

CGDV is branded as the Capital Group's "Dividend Value" ETF, but a quick glance at its strategy, holdings, and fundamentals reveals that it's neither dividend- nor value-oriented. Still, that's not an issue for me. Even when comparing it with an appropriate peer like SPY, CGDV has delivered better total returns and risk-adjusted returns since its inception. Fundamentally, CGDV is grounded in strong next-year estimated earnings growth - 18%, which is about 5% more than even low-yielding large-cap value funds like VIG and DGRW.

Retirees seeking dividend income face a fundamental choice: prioritize immediate cash flow or accept lower yield for capital appreciation.

Dividend ETFs are a great way to create long-term passive income streams from your portfolio. Investors can target dividend growth, dividend quality, or high-yield strategies to generate income.

To generate passive income while also potentially earning capital appreciation, many investors turn to dividend paying stocks.

Capital Group Dividend Value ETF offers a compelling blend of income and growth, outperforming peers and the S&P 500 since inception. CGDV's unique multi-manager approach, sector allocation, and concentrated portfolio drive its strong returns and defensive positioning. While CGDV's yield is lower than some dividend-focused ETFs, its dividend and NAV growth, plus qualified distributions, enhance its appeal.

"Bloomberg ETF IQ" focuses on the opportunities, risks and current trends tied to the trillions of dollars in the global exchange traded funds industry. Today's guests: Capital Group Head of Global Product Strategy and Development Holly Framsted, State Street Investment Management CEO Yie-Hsin Hung and HDGE ETF Co-Portfolio Manager Brad Lamensdorf.

Capital Group Dividend Value ETF delivers strong total returns and lower volatility, making it an attractive choice for buy-and-hold investors. CGDV's focused, actively managed portfolio blends value and growth, with significant technology exposure and resilience during market uncertainty. Compared to peers like VTV and SPDV, CGDV outperforms on total return and demonstrates capital preservation during market declines, despite a lower starting yield.

Market volatility sparks income hunt -- dividend ETFs like SCHD, CGDV, SPYD, IDV, FDL & DIVO under $50 offer steady yields and value.