Why Buybacks Are An Important Factor To Consider For ETFs (PKW)
“I believe that share buybacks can be another helpful tool — when a company’s management team reduces the number of shares outstanding, it is signaling to the market that a stock is trading inexpensively to its intrinsic value….”
Read the full article at ETF Daily News right here: PowerShare Buyback Achievers Fund (ETF)(NASDAQ:PKW): Discover Hidden Value | ETF Daily News
Beaten-down sectors provide opportunity
The S&P 500 Index is up about 10% so far this year, but the energy sector is off over 19%.1 Yet, my team believes conditions are ripe for a turnaround in energy.
- Exploration, production and service company valuations are near historic lows based on our analysis, trading at a price-to-book (P/B) multiple of 0.55. This compares with an average P/B of 0.88 for the sector using data all the way back to 1952.2
- Many energy companies are currently what we call “under-earners.” In good times, these firms can be cash-generating machines, but the long stretch of low energy prices has resulted in layoffs, dividend cuts, fewer stock buybacks and expense reductions. Once prices rebound a bit and stick, these companies should be even better positioned for growth, in our view.
- The sector is clearly out of favor and has been for some time. We believe investors are always wise to consider sentiment, but should then dig a little deeper and analyze the trends and facts.
- After the long period of underperformance, many funds (understandably) lightened up on energy shares and are now underweight.3 At some point, this trend will reverse, and demand for these shares should increase. Also, many investors have taken short positions in energy stocks, and they will have to buy shares in order to settle these positions.
- Last, energy company capital expenditures (CapEx) are at historically unsustainable levels relative to cash flow.
Read the full article at ETF Daily News right here: Energy Select Sector SPDR (ETF)(NYSE:XLE): Opportunity Awaits | ETF Daily News
The Deep Value ETF Accumulator invests in the WisdomTree Emerging Markets High Dividend Fund (DEM : $DEM). This article may be important to others who also invest in this fund.
Read the full article at ETF Daily News right here: WisdomTree Emerging Markets Eqty Incm Fd(NYSE:DEM): A Shares Making A Difference | ETF Daily News
The Deep Value ETF Accumulator continues to accumulate shares of XLE. It looks like Mike Burnick at ETF Daily News has something to say about that.
Read full article here: Energy Select Sector SPDR (ETF)(NYSE:XLE): Time To Buy? | ETF Daily News
The Deep Value ETF Accumulator invests in The PowerShares BuyBack Achievers™ Portfolio ETF, PKW $PKW. PKW is featured in this article.
From Contrarian Outlook: I know I don’t have to tell you that risk management is one of the keys to successful long-term investing. But here’s the strange thing: most responsible, risk-conscious investors underperform the market—and not
Source: PowerShare Buyback Achievers Fund (ETF)(NASDAQ:PKW): High Total Return Without High Risk | ETF Daily News