Is SPYD S&P500 High Dividend ETF A Good Buy?

🌟🌟🌟SPYD $SPDR Portfolio S&P 500 High Dividend ETF(SPYD)$ is built to track the S&P500 High Dividend Index by selecting 80 highest yielding stocks from the S&P500 Index.  What distinguishes SPYD is its approach of equally weighting these stocks.  This setup results in an ETF with an attractive dividend yield at 4.79%.  SPYD also has a low expense ratio of just 0.07%. 

The Top 10 holdings include CVS Health, Consolidated Edison Inc, Philip Morris International, AT&T Inc, Exelon Corp, JM Smucker Co, Verizon Communications, Altria Group, WEC Energy Group and Crown Castle Inc.

All Top 10 holdings have a weightage of less than 2%.  The total number of holdings is 77.

The Real Estate sector takes up 23.5% of the ETF, followed by the Utilities Sector at 19.2% and Consumer Staples at 16%.  Then we have the Financial Sector at 13%, Energy at 6.9%, Communications Sector at 4.4%, Materials at 4.3% and Consumer Discretionary at 3.5%.

$CVS Health(CVS)$  is a leading health solutions company that offers multiple channels to access health care locally and nationally.  CVS Health provides pharmacy services, health plans, and health and wellness solutions .  As the largest pharmacy health care provider in the US, CVS Health aims to deliver high quality personalised and affordable healthcare.

CVS Health is a Dividend Aristocrat as it has been  increasing  its dividends each year since 1997.  It currently pays a  generous dividend which yields 4.8%.

Consolidated Edison $Consolidated Edison(ED)$ is a publicly traded utility company that provides electricity, gas and steam services to more than 3 million customers in New York City and Westchester County, New York.  The company generates approximately USD 13.7 billion in annual revenue and has a market capitalisation of almost USD 33.8 billion.  Consolidated Edison is a Dividend King with 51 years of consistent dividend growth.  The current dividend yield is 3.02%.

$Philip Morris(PM)$  is US multinational tobacco company with products sold in over 180 countries.  The most recognised and best selling product of the company is Marlboro. Its other major cigarette brands include L&M and Chesterfield.  The current dividend yield is 3.35%.  Philip Morris is also a Dividend Aristocrat. 

$AT&T Inc(T)$  is an American Telecommunications Giant.  It is the world's 3rd largest telecommunications company by revenue and the 3rd largest wireless carrier in the US behind Verizon and T Mobile.  AT&T has a dividend yield of 4.16%.

These are just 4 of SPYD's top holdings.   For those who are new to investing, a Dividend King is part of the S&P500 and a company that has consistently increased its dividend payment for at least 50 consecutive years.  A Dividend Aristocrat is a company that has consistently increased its dividend payment for at least 25 consecutive years. 

Dividend Kings and Dividend Aristocrats typically have robust balance sheets, consistent earnings, and strong cash flow, enabling them to sustain dividends over long periods.  These elite group of companies often dominate their industries, providing them with a competitive edge that helps generate consistent profits, even during challenging economic times. 

Wall Street Analysts are bullish on SPYD with a Buy rating, Average Target price of USD 45.67, an upside potential of 12.9% according to Tipranks. 

I like SPYD as it provides me with a steady source of passive income while waiting for capital growth.  It also does the heavy lifting for me in selecting the best dividend paying companies at a low cost, weeding out the non performing ones. 

In the current volatile markets, SPYD serves as an effective component of a diversified portfolio with the extra benefit of great dividends at a low cost and its equal weighted selection of S&P 500 stocks.   It is dividend investing at its best!  Maximum power, minimum cost! 

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