5 Top-Ranked ETFs at New Highs Set to Soar Further
U.S. stocks rallied in February, with the S&P 500 and the Nasdaq Composite Index recording the best month in nearly a decade. The Dow Jones Industrial Average logged a four-month winning streak for the first time since May 2021. For the month, the Nasdaq gained 6.1%, while the S&P 500 added 5.2%. The Dow Jones was up 2.1%.
The prospects of significant earnings growth, as well as the artificial intelligence boom, led to a strong rally during the month. Given the bullishness, many ETFs touched new 52-week high and are expected to soar further. We have highlighted five of them that also have a solid Zacks ETF Rank #1 (Strong Buy) or 2 (Buy), suggesting outperformance in the coming weeks. These are VanEck Vectors Semiconductor ETF SMH, Invesco S&P MidCap Momentum ETF XMMO, Invesco Dorsey Wright Industrials Momentum ETF PRN, Invesco Next Gen Media and Gaming ETF GGME and Invesco Large Cap Growth ETF PWB.
Consumer discretionary was the top-performing sector of February. The surge was driven by the wide-ranging appeal of stocks geared toward consumer services. Industrials was the second-best-performing sector, with nearly half of its components in the S&P 500 hitting all-time highs. The addition of Uber Technologies UBER in the Dow Jones Transportation Average buoyed the sector's performance.
With 97% of the S&P 500 having already reported earnings for the fourth quarter, year-over-year earnings growth is expected to be 4%, per new FactSet data. This marks the second consecutive quarter of earnings growth for the index (read: 5 ETFs at All-Time Highs as S&P 500 Rally Continues).
In the latest data, consumer prices increased at their slowest rate in nearly three years, according to the Federal Reserve’s preferred measure of inflation.
Another major achievement in the last month was Bitcoin’s biggest monthly gain since December 2020. Bitcoin gained 45% to reach $62,000 amid surging optimism. Demand for the token is widening beyond committed digital-asset enthusiasts.
We have profiled the abovementioned ETFs in detail below:
VanEck Vectors Semiconductor ETF (SMH) – Up 21.2%
VanEck Vectors Semiconductor ETF offers exposure to the companies involved in semiconductor production and equipment. SMH follows the MVIS US Listed Semiconductor 25 Index, which measures the overall performance of companies involved in semiconductor production and equipment. VanEck Vectors Semiconductor ETF holds 26 stocks in its basket.
VanEck Vectors Semiconductor ETF has managed assets worth $15.9 billion and charges 35 bps in annual fees and expenses. SMH is heavily traded with a volume of 8 million shares per day and has a Zacks ETF Rank #1 with a High risk outlook.
Invesco S&P MidCap Momentum ETF (XMMO) – Up 20%
Invesco S&P MidCap Momentum ETF follows the S&P Midcap 400 Momentum Index, which is designed to identify mid-cap firms having the highest momentum scores. It holds 74 stocks in its basket, with key holdings in industrials, consumer discretionary, information technology and financials.
Invesco S&P MidCap Momentum ETF has AUM of $1.6 billion and charges 34 bps in annual fees. It trades in an average daily volume of 184,000 shares and has a Zacks ETF Rank #2.
Invesco Dorsey Wright Industrials Momentum ETF (PRN) – Up 12.7%
Invesco Dorsey Wright Industrials Momentum ETF provides exposure to 45 industrial companies that are showing relative strength (momentum) and follows the the Dorsey Wright® Industrials Technical Leaders Index. It is widely spread across trading companies, building products, electrical equipment and construction & engineering (read: Momentum ETFs Hit New 52-Week Highs).
Invesco Dorsey Wright Industrials Momentum ETF has accumulated $193.3 million in its asset base and charges 60 bps in annual fees. It trades in an average daily volume of 8,000 shares and has a Zacks ETF Rank #2 with a Medium risk outlook.
Invesco Next Gen Media and Gaming ETF (GGME) – Up 11.3%
Invesco Next Gen Media and Gaming ETF offers exposure to companies with significant exposure to technologies or products that contribute to future media through direct revenue. It tracks the STOXX World AC NexGen Media Index, holding 96 stocks in its basket.
Invesco Next Gen Media and Gaming ETF has amassed $31.1 million in its asset base and charges 60 bps in annual fees.
Invesco Large Cap Growth ETF (PWB) – Up 10.9%
Invesco Large Cap Growth ETF offers exposure to the growth segment of the large-cap U.S. stock market. It tracks the Dynamic Large Cap Growth Intellidex Index, holding well-diversified 51 stocks in its basket. Information technology takes the largest share at 39.5%, followed by 15.6% in industrials and 14.5% in consumer discretionary (read: 5 Large-Cap ETFs That Doubled the S&P 500 Gains5 Large-Cap ETFs That Doubled the S&P 500 Gains).
Invesco Large Cap Growth ETF has amassed $826.4 million in its asset base and charges 56 bps in annual fees. It trades in an average daily volume of 30,000 shares and has a Zacks Rank #2 with a Medium risk outlook.
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Invesco Dorsey Wright Industrials Momentum ETF (PRN): ETF Research Reports
VanEck Semiconductor ETF (SMH): ETF Research Reports
Invesco Large Cap Growth ETF (PWB): ETF Research Reports
Uber Technologies, Inc. (UBER) : Free Stock Analysis Report
Invesco S&P MidCap Momentum ETF (XMMO): ETF Research Reports
Invesco Next Gen Media and Gaming ETF (GGME): ETF Research Reports
