WisdomTree U.S. Quality Price, Forecast, Insider, Ratings, Fundamentals & Signals

Dividends and buybacks are two ways companies can return cash to shareholders. Dividend-growth ETFs are popular among investors interested in companies that consistently raise their dividends over time, but it is typical to require constituents to demonstrate 5, 10 or even 20 years of historical growth.

The WisdomTree U.S. Quality Dividend Growth Fund is a dividend-focused ETF that uses fundamental screens to select quality and growth stocks. September last year, I issued a thesis on DGRW outlining several reasons why this ETF embodies no advantage over the S&P 500 and why it is unattractive as a dividend ETF. Since then, DGRW has outperformed some comparable peers but has fallen short of the S&P 500, largely confirming my thesis.

WisdomTree recently announced a special rebalancing for its domestic dividend indexes to reflect the addition of Meta Platforms. The changes became effective Monday, March 18. This addition may prove beneficial to DGRW, one of WisdomTree's most popular quality-themed ETFs. DGRW is one of the few dividend-focused funds to offer near double-digit earnings per share growth. However, this growth doesn't come cheap. DGRW has one of the highest forward P/E ratios in the large-cap value category, and its 1.68% expected dividend yield is not too attractive.

DGRW: A Dividend Growth Fund Needs A Growing Dividend

The dominance of a few large technology stocks in the S&P 500 has caused concern among investors, but there may be useful alternatives in the form of equal-weighting approaches or dividend-growth strategies.

DGRW's dividend growth has been lackluster, but the ETF has provided a superior total return compared against the S&P500. The holdings are weighted more heavily towards tech. As a result, the price is more likely to experience upside. There are several catalysts that can help propel DGRW to higher prices. This includes AI, interest rate cuts, and increased consumer spending.

Launched on 05/22/2013, the WisdomTree U.S. Quality Dividend Growth ETF (DGRW) is a smart beta exchange traded fund offering broad exposure to the Style Box - Large Cap Value category of the market.

FlexShares Quality Dividend Index Fund ETF has a portfolio of 130 dividend stocks screened with a proprietary quality score.

I am a fan of monthly dividends, because they provide income stability and slightly increase the speed of compounding. I highlight eight monthly dividend payers that I consider to be high-quality investments with sustainable payouts. Monthly dividends are great, but not at the expense of the quality of assets, management, and balance sheet. Those factors are more important.

WisdomTree U.S. Quality Dividend Growth ETF offers access to dividend-paying stocks (with a market cap of over $2bn) with growth characteristics. DGRW has outperformed the S&P 500 since its inception, with lower volatility and a strong risk-adjusted return track record. It has also fared well during environments of harmful volatility. Despite all its merits, we touch upon a few reasons why a fresh long position now could be dicey.