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Some Dividend Stars Call This ETF Home

BY | ETF Database
9:42 am ET 09/30/26 | 30 VIEWS
  • Related Symbols
  • PFM
Due in part to companies allocating more cash to share buybacks than payouts and the S&P 500 yielding a paltry 1.1% (depending on the day), it may feel as though dividend stocks and the related ETFs are being pushed to the back burner this year.The reality is something different. That’s because there’s still a compelling long-term case for equity income investing, and some dividend ETFs are close to keeping pace with the broader market. While the year-to-date upside offered by the Invesco Dividend Achievers ETF (PFM B+) isn’t jaw-dropping, this $778.17 million ETF yields about 30 basis points more than S&P 500. It’s also delivering 360 basis points less in the way of annualized volatility since the start of the year. PFM, which turned 21 years old in early September, tracks the Nasdaq US Broad Dividend AchieversIndex. That index choice is pertinent to long-term investors because its requirement for admission is at least 10 consecutive years of increased payouts. Many PFM member firms far exceed that mandate.PFM Perfect for Dependable DividendsExperienced dividend investors know the names of the game are dependability and quality more than eye-catching yields. Fortunately, PFM meets that mark. That’s because the ETF is home to what some experts believe are the top large-cap dividend stocks, a group including telecom giant Verizon (VZ). “The stock is trading 13% below our fair value estimate of $54 per share. Morningstar senior analyst Mike Hodel notes that price cuts have revived customer growth this year. He adds that Verizon directed 60% of 2025’s cash flows to the dividend and has started to repurchase shares,” said Morningstar’s Susan Dziubinski. Though battered and bruised at the moment, both PepsiCo (PEP) and McDonald’s (MCD), two more PFM holdings, rank among attractively valued dividend stocks today. “We don’t expect near-term challenges from consumer belt-tightening to derail Pepsi’s growth from innovation and international expansion, reports Morningstar senior analyst Kristoffer Inton. Over the next decade, we expect Pepsi’s payout ratio to stabilize in the low 70s on average and the dividend payment to increase at a mid-single-digit pace annually,” added Dziubinski. Perhaps one of the more underappreciated points about PFM is that its largest sector weight is 22.3% to tech, which has fast become a credible dividend destination. Apple (AAPL) and Microsoft (MSFT) combine for 8.49% of the ETF’s portfolio and are the fund’s top two holdings. For more news, information, and analysis, visit the Innovative ETFs Content Hub. Invesco Distributors, Inc. is an independent company unaffiliated with VettaFi LLC (“VettaFi”). These articles do not form any kind of legal partnership, agency affiliation, or similar relationship between VettaFi and Invesco Distributors, Inc., nor is such a relationship created or implied by the articles herein. VettaFi LLC is the author and owner of these articles.

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