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The Zacks Analyst Blog Highlights IAK, IHI, PTF, PPA and QUAL
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For Immediate Release
Chicago, IL – September 4, 2024 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: iShares U.S. Insurance ETF (IAK - Free Report) , iShares U.S. Medical Devices ETF (IHI - Free Report) , Invesco DWA Technology Momentum ETF (PTF - Free Report) , Invesco Aerospace & Defense ETF (PPA - Free Report) and iShares MSCI USA Quality Factor ETF (QUAL - Free Report) .
Here are highlights from Tuesday’s Analyst Blog:
5 Best Top-Ranked ETFs of August with More Room for Upside
Wall Street wrapped up August on a positive note after a turbulent start due to the tech sell-off. The Dow Jones touched a series of record highs, gaining 1.8%, while the S&P 500 marked its fourth straight winning month, rising 2.3%. The tech-heavy Nasdaq Composite Index logged 0.7% growth despite investors losing faith in the technology sector.
Given this, investors should bet on ETFs that were winners in August and have a solid Zacks ETF Rank #1 (Strong Buy) or 2 (Buy), suggesting outperformance in the coming weeks.
While recession fears keep investors on edge early in the month, a likely rate cut in September is likely to fuel optimism in the stock market in the latter part. Cyclical sectors, which are poised to benefit from rate cuts, and defensive sectors, such as consumer staples, real estate and healthcare, lifted the broad market index (read: 5 Quality ETFs to Bet on Amid Volatile Markets).
A similar trend is expected to continue in the coming weeks, given the pending Fed decision to cut rates this month and the upcoming presidential election in November. The rate-cut decision will drive investors toward cyclical sectors, while volatility will raise the appeal for defensive ones. Federal Reserve Chair Jerome Powell signaled that interest rate cuts are coming in September, citing easing inflation and a weakening job market.
Lower rates generally lead to reduced borrowing costs for mortgages, credit cards and other consumer and business loans. These help businesses expand their operations more easily, resulting in increased profitability. This, in turn, stimulates economic growth and boosts the stock market.
We have profiled the abovementioned ETFs in detail below:
iShares U.S. Insurance ETF – Up 7.5%
With AUM of $683.4 million, iShares U.S. Insurance ETF offers exposure to U.S. companies that provide life, property and casualty, and full-line insurance. It tracks the Dow Jones U.S. Select Insurance Index and holds 52 securities in its basket with a double-digit concentration on the top two firms. Property & casualty insurance accounts for the largest share at 72.8%, while life & health insurance rounds off the next spot with double-digit exposure.
iShares U.S. Medical Devices ETF provides exposure to U.S. companies that manufacture and distribute medical devices by tracking the Dow Jones U.S. Select Medical Equipment Index. In total, the fund holds 50 securities in its basket, with a heavy concentration on the top three firms.
iShares U.S. Medical Devices ETF has AUM of $5 billion and charges 40 bps in fees per year. It has a Zacks ETF Rank #2.
Invesco DWA Technology Momentum ETF – Up 6.2%
Invesco DWA Technology Momentum ETF offers exposure to 35 tech companies that are showing relative strength (momentum) by tracking the Dorsey Wright Technology Technical Leaders Index. Semiconductor & Equipment takes the largest share at 38.3%, followed by software (31%) and diversified telecom services (10%) (read: 5 Technology ETFs at the Forefront of the August Rebound).
Invesco DWA Technology Momentum ETF is relatively illiquid and unpopular, with AUM of $438.7 million. It charges 60 bps in annual fees and has a Zacks ETF Rank #1 with a High risk outlook.
Invesco Aerospace & Defense ETF – Up 5.6%
Invesco Aerospace & Defense ETF offers exposure to 55 companies involved in the development, manufacturing, and operations, as well as provides support to U.S. defense, homeland security and aerospace. It tracks the SPADE Defense Index, charging 58 bps in annual fees from investors.
Invesco Aerospace & Defense ETF has so far managed assets of $3.8 billion and has a Zacks ETF Rank #2 with a Medium risk outlook.
iShares MSCI USA Quality Factor ETF - Up 5%
With an AUM of $48.8 billion, iShares MSCI USA Quality Factor ETF provides exposure to large and mid-cap stocks exhibiting positive fundamentals (high return on equity, stable year-over-year earnings growth and low financial leverage) by tracking the MSCI USA Sector Neutral Quality Index.
QUAL holds 124 stocks in its basket and charges 15 bps in annual fees. It has a Zacks ETF Rank #2 with a Medium risk outlook.
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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The Zacks Analyst Blog Highlights IAK, IHI, PTF, PPA and QUAL
For Immediate Release
Chicago, IL – September 4, 2024 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: iShares U.S. Insurance ETF (IAK - Free Report) , iShares U.S. Medical Devices ETF (IHI - Free Report) , Invesco DWA Technology Momentum ETF (PTF - Free Report) , Invesco Aerospace & Defense ETF (PPA - Free Report) and iShares MSCI USA Quality Factor ETF (QUAL - Free Report) .
Here are highlights from Tuesday’s Analyst Blog:
5 Best Top-Ranked ETFs of August with More Room for Upside
Wall Street wrapped up August on a positive note after a turbulent start due to the tech sell-off. The Dow Jones touched a series of record highs, gaining 1.8%, while the S&P 500 marked its fourth straight winning month, rising 2.3%. The tech-heavy Nasdaq Composite Index logged 0.7% growth despite investors losing faith in the technology sector.
Given this, investors should bet on ETFs that were winners in August and have a solid Zacks ETF Rank #1 (Strong Buy) or 2 (Buy), suggesting outperformance in the coming weeks.
While recession fears keep investors on edge early in the month, a likely rate cut in September is likely to fuel optimism in the stock market in the latter part. Cyclical sectors, which are poised to benefit from rate cuts, and defensive sectors, such as consumer staples, real estate and healthcare, lifted the broad market index (read: 5 Quality ETFs to Bet on Amid Volatile Markets).
A similar trend is expected to continue in the coming weeks, given the pending Fed decision to cut rates this month and the upcoming presidential election in November. The rate-cut decision will drive investors toward cyclical sectors, while volatility will raise the appeal for defensive ones. Federal Reserve Chair Jerome Powell signaled that interest rate cuts are coming in September, citing easing inflation and a weakening job market.
Lower rates generally lead to reduced borrowing costs for mortgages, credit cards and other consumer and business loans. These help businesses expand their operations more easily, resulting in increased profitability. This, in turn, stimulates economic growth and boosts the stock market.
We have profiled the abovementioned ETFs in detail below:
iShares U.S. Insurance ETF – Up 7.5%
With AUM of $683.4 million, iShares U.S. Insurance ETF offers exposure to U.S. companies that provide life, property and casualty, and full-line insurance. It tracks the Dow Jones U.S. Select Insurance Index and holds 52 securities in its basket with a double-digit concentration on the top two firms. Property & casualty insurance accounts for the largest share at 72.8%, while life & health insurance rounds off the next spot with double-digit exposure.
iShares U.S. Insurance ETF charges 39 bps in annual fees and has a Zacks ETF Rank #2 with a Medium risk outlook (read: ETF Winners of Q2 Earnings: 4 Must-See Charts).
iShares U.S. Medical Devices ETF – Up 7.5%
iShares U.S. Medical Devices ETF provides exposure to U.S. companies that manufacture and distribute medical devices by tracking the Dow Jones U.S. Select Medical Equipment Index. In total, the fund holds 50 securities in its basket, with a heavy concentration on the top three firms.
iShares U.S. Medical Devices ETF has AUM of $5 billion and charges 40 bps in fees per year. It has a Zacks ETF Rank #2.
Invesco DWA Technology Momentum ETF – Up 6.2%
Invesco DWA Technology Momentum ETF offers exposure to 35 tech companies that are showing relative strength (momentum) by tracking the Dorsey Wright Technology Technical Leaders Index. Semiconductor & Equipment takes the largest share at 38.3%, followed by software (31%) and diversified telecom services (10%) (read: 5 Technology ETFs at the Forefront of the August Rebound).
Invesco DWA Technology Momentum ETF is relatively illiquid and unpopular, with AUM of $438.7 million. It charges 60 bps in annual fees and has a Zacks ETF Rank #1 with a High risk outlook.
Invesco Aerospace & Defense ETF – Up 5.6%
Invesco Aerospace & Defense ETF offers exposure to 55 companies involved in the development, manufacturing, and operations, as well as provides support to U.S. defense, homeland security and aerospace. It tracks the SPADE Defense Index, charging 58 bps in annual fees from investors.
Invesco Aerospace & Defense ETF has so far managed assets of $3.8 billion and has a Zacks ETF Rank #2 with a Medium risk outlook.
iShares MSCI USA Quality Factor ETF - Up 5%
With an AUM of $48.8 billion, iShares MSCI USA Quality Factor ETF provides exposure to large and mid-cap stocks exhibiting positive fundamentals (high return on equity, stable year-over-year earnings growth and low financial leverage) by tracking the MSCI USA Sector Neutral Quality Index.
QUAL holds 124 stocks in its basket and charges 15 bps in annual fees. It has a Zacks ETF Rank #2 with a Medium risk outlook.
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.
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.