AB US High Dividend ETF

HIDV

Market cap $222M

I initiate coverage of the AB US High Dividend ETF with a Buy rating. HIDV has an active, high-turnover strategy offering "core US equity exposure with attractive dividend income and the potential for capital growth." I would argue that the IT-heavy HIDV portfolio has a strong GARP tilt, manifested in a WA PEG ratio of 0.75. Its quality characteristics also reinforce the thesis.

HIDV is an actively managed fund with a 0.45% expense ratio and only $59 million in assets under management, indicating it's relatively unknown in the ETF space. Nevertheless, HIDV might be underrated. It's delivered good returns since its inception, outperforming large-cap value peers like FDVV and DIVB, and almost keeping pace with its benchmark, the S&P 500. HIDV's fundamentals are strong too. I'll dive into its holdings' growth, value, and quality statistics, which match up well against the comparators in this article: FDVV, DIVB, CGDV, and SPY.

This week's ETF Wrap takes you inside the rally in dividend-paying equity ETFs as investors seek to position for President-elect Donald Trump's second term in the White House.

Dividend-paying stocks provide a steady income stream and help mitigate potential losses during weaker market periods.

Demand has been strong for short-term fixed income ETFs in 2023. That helped AllianceBernstein (AB) pass $1 billion invested in ETFs assets in early November.