If you're interested in broad exposure to the Large Cap Value segment of the US equity market, look no further than the Pacer US Cash Cows 100 ETF (COWZ), a passively managed exchange traded fund launched on 12/16/2016.
The fund is sponsored by Pacer Etfs. It has amassed assets over $21.15 billion, making it one of the largest ETFs attempting to match the Large Cap Value segment of the US equity market.
Why Large Cap Value
Companies that fall in the large cap category tend to have a market capitalization above $10 billion. Overall, they are usually a stable option, with less risk and more sure-fire cash flows than mid and small cap companies.
Value stocks have lower than average price-to-earnings and price-to-book ratios. They also have lower than average sales and earnings growth rates. While value stocks have outperformed growth stocks in nearly all markets when you consider long-term performance, growth stocks are more likely to outpace value stocks in strong bull markets.
Costs
When considering an ETF's total return, expense ratios are an important factor, and cheaper funds can significantly outperform their more expensive counterparts in the long term if all other factors remain equal.
Annual operating expenses for this ETF are 0.49%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.55%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Information Technology sector--about 17.30% of the portfolio. Energy and Consumer Discretionary round out the top three.
Looking at individual holdings, Marathon Petroleum Corp (MPC) accounts for about 2.42% of total assets, followed by Booking Holdings Inc (BKNG) and Uber Technologies Inc (UBER).
The top 10 holdings account for about 21.95% of total assets under management.
Performance and Risk
COWZ seeks to match the performance of the Pacer US Cash Cows 100 Index before fees and expenses. The Pacer US Cash Cows 100 Index uses an objective, rules-based methodology to provide exposure to large and mid-capitalization U.S. companies with high free cash flow yields.
The ETF has added about 0.96% so far this year and is up about 6.64% in the last one year (as of 07/07/2025). In the past 52-week period, it has traded between $47.46 and $61.35.
The ETF has a beta of 0.94 and standard deviation of 18.10% for the trailing three-year period. With about 102 holdings, it effectively diversifies company-specific risk.
Alternatives
Pacer US Cash Cows 100 ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, COWZ is a reasonable option for those seeking exposure to the Style Box - Large Cap Value area of the market. Investors might also want to consider some other ETF options in the space.
The Schwab U.S. Dividend Equity ETF (SCHD) and the Vanguard Value ETF (VTV) track a similar index. While Schwab U.S. Dividend Equity ETF has $71.37 billion in assets, Vanguard Value ETF has $140.79 billion. SCHD has an expense ratio of 0.06% and VTV charges 0.04%.
Bottom-Line
An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they are also excellent vehicles for long term investors.
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
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Pacer US Cash Cows 100 ETF (COWZ): ETF Research Reports Marathon Petroleum Corporation (MPC): Free Stock Analysis Report Vanguard Value ETF (VTV): ETF Research Reports Schwab U.S. Dividend Equity ETF (SCHD): ETF Research Reports Booking Holdings Inc. (BKNG): Free Stock Analysis Report Uber Technologies, Inc. (UBER): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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