The Schwab US Dividend ETF (SCHD) stock price has done well this year and is hovering near its all-time high of $29.70. It has jumped by 16.5%, a notable performance for a fund that has no exposure to the fast-growing technology sector.
Top Schwab US Dividend ETF stocks are doing well
The SCHD ETF has soared this year, helped by the strong performance of some of its top companies.
- Cisco stock is up by 20% this year – The biggest company in the fund has soared, helped by its strong performance following the acquisition of Splunk, a leading player in the cybersecurity industry.
- Blackrock – Blackrock stock price has soared this year after its assets under management jumped to over $11.5 trillion. The company has also benefited from its acquisitions of Global Infrastructure Partners, Prequin, and the rumored buyout of HPS.
- Home Depot – The HD stock price has jumped by almost 30% this year as the company returned to growth. HD benefits from its scale and the fact that its products are seen as being of a high quality and affordable price. It also acquired SRS Distribution in a $18.2 billion deal.
- Verizon – Verizon and other large technology companies have soared this year, helped by their strong dividends and cost cuts. Verizon shares have jumped by almost 20% this year.
- Altria – MO, a leading company in the tobacco industry, has jumped by 50% in sync with other large players in the industry like Philip Morris and British American Tobacco. Its performance is mostly because of its strong profits and dividends.
- Bristol-Myers Squibb – BMY, a top player in the pharmaceutical industry, has risen by almost 20% this year.
Other top companies in the Schwab US Dividend Equity ETF like Coca-Cola, Oneok, Fastenal, and Best Buy have done well this year.
The SCHD’s performance still lags that of the S&P 500 and the Nasdad 100 indices. Data shows that its total return, which is made up of the stock return and the returned dividends, has risen by 19.7% this year. In contrast, the SPDR S&P 500 (SPY) and the Invesco QQQ ETF (QQQ) ETFs rose by 28% and 25% this year.
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The latter two funds always beat the SCHD because of their exposure to the technology industry. The technology sector accounts for about 31% of the S&P 500 index. Its biggest constituent companies are firms like Apple, NVIDIA, Microsoft, and Amazon.com.
Similarly, the Invesco QQQ tracks the Nasdaq 100 index, and is made up of the biggest tech companies in the US. The most notable companies are in the tech sector and is followed by consumer discretionary, healthcare, telecommunication, and consumer staples.
Therefore, while the SCHD ETF is a cheaper ETF than QQQ and SPY, I believe that the latter two are better investments. Besides, SCHD’s dividend yield of 3.3% is not all that bigger than the other 2.
SCHD ETF analysis
SCHD chart by TradingView
The daily chart shows that the SCHD stock has done well in the past few months. It has jumped from $24.73, its lowest level in April this year to $29.70.
The stock has remained above the 50-day and 100-day Exponential Moving Averages (EMA), a popular bullish sign. Also, the Relative Strength Index (RSI) and the MACD indicators have continued soaring.
It has formed a rising wedge chart pattern, a popular bearish sign. Therefore, the odds of the SCHD ETF rising to $50 in the near term are a bit limited. However, in the long term, the stock will bounce back and hit that level in the next few years.
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