Stock Analysis & Ideas

Are You Looking for Value Stocks? Consider this ETF

Story Highlights

ETFs that focus on value stocks have solid growth potential. Further, they help diversify risk at a low cost.

With the massive correction in the prices of top companies, several stocks are offering great value. However, picking the right value stock could take a lot of work. This is where exchange-traded funds (ETFs) like Avantis U.S. Small Cap Value ETF (AVUV) come in handy. The ETF gives exposure to several stocks that are undervalued. Moreover, it reduces the overall risk through diversification. Let’s dig deeper.

Is AVUV a Good ETF?

Avantis U.S. Small Cap Value ETF is performing exceptionally well. The ETF targets long-term capital appreciation and invests in U.S. small-cap companies with low valuations and high profitability ratios. The fund started in 2019 and has over $5.7 billion in total assets.

The AVUV ETF has delivered an annualized return of over 20% in three years and outperformed the Russell 2000 Index by a wide margin. Furthermore, this growth comes at a low expense ratio of 0.25%. 

By sector, the ETF has the highest emphasis on financials, which account for 29% of the total holdings. Meanwhile, the industrial, consumer discretionary, and energy sectors account for 17%, 17%, and 16%, respectively.

The fund is highly diversified. Meanwhile, its top five holdings include Ryder System (NYSE:R), Triton International (NYSE:TRTN), Foot Locker (NYSE:FL), Thor Industries (NYSE:THO), and Atkore International Group (NYSE:ATKR).

Our data shows that hedge funds have accumulated the AVUV ETF. However, insiders have lowered their exposure. Overall, it carries a Neutral Smart Score of seven. 

Bottom Line 

The AVUV ETF has delivered above-average returns and outperformed the benchmark index. However, given the uncertainty surrounding the macroeconomic environment, the ETF has a Neutral Smart Score. 


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