Latest news with #VEU
CNBC
23-06-2025
- Business
- CNBC
These international stocks are well liked by analysts, and they pay dividends
International stocks are having a strong year compared to the S & P 500 – and a few of those global names also happen to offer attractive dividends. The broad market S & P 500 is up just 2% in 2025, which pales in comparison to the double-digit surges the benchmark saw in 2023 and 2024. Uncertainty over tariff policy, shakiness on the path of interest rates – and now the U.S.'s involvement in attacks in the Middle East – have sent stocks on a roller-coaster ride. After the S & P 500's big two-year run, it only makes sense that U.S. investors might want to rethink their international exposure to diversify away from overallocations in Big Tech and U.S. names. "If you looked at international last year, it might've underperformed but this year, international has been a star," said Marguerita Cheng, certified financial planner and chief executive officer of Blue Ocean Global Wealth in in Gaithersburg, Maryland. .SPX VEU YTD mountain S & P 500 vs. the Vanguard FTSE All-World ex-US ETF (VEU) in 2025 Indeed, the Vanguard FTSE All-World ex-US ETF (VEU) saw a return of roughly 5.5% in 2024, but it's now up 14% this year. To get some international exposure, particularly for dividend-seeking investors, she has turned to offerings like the First Trust Target Global Dividend Leaders Portfolio. The strategy in this unit investment trust offers a combination of domestic and international equity names, as well as real estate investment trusts. CNBC Pro scanned through the constituents of that portfolio to find international names that offer dividends. Here are a few of the names that are rated buy or overweight by more than 50% of the analysts covering them, and they have upside of more than 20%, based on FactSet consensus price targets. Panamanian airline company Copa Holdings emerged on the list. U.S.-traded shares are up more than 16% in 2025, and the stock pays a dividend yield of about 6.3%. More than 9 out of 10 analysts covering the name deem it a buy or overweight, and consensus price targets call for more than 50% upside, per FactSet. Raymond James analyst Savanthi Syth reiterated a strong buy rating on Copa in May, noting that the airline delivered "Best In Class 1Q25 Results." The company posted earnings of $4.28 per share on revenue of $899.2 million for the period, topping FactSet consensus estimates of $3.94 per share and revenue of $888.6 million. "Copa noted healthy booking trends with no material change in recent weeks, although visibility is limited to 2-3 months out," Syth wrote. "Demand in North America and the Caribbean appears stable, while Mexico and Central America face headwinds from elevated competitive capacity, notably from Avianca." The analyst's price target of $145 calls for upside of more than 41% from Friday's close. Vale , the Brazilian mining company, is another name that's caught Wall Street's attention. The stock is rated buy or overweight by nearly 60% of the analysts covering it. Consensus price targets call for 32% upside from current levels, per FactSet. In April, Bank of America upgraded the stock to buy from neutral, with analyst Caio Ribeiro saying that the "bottom-up story has improved significantly." In part that's due to the conclusion of a railway dispute and a new management team that includes Gustavo Pimenta as CEO and Marcelo Bacci as CFO. "Vale's discounted valuation combined with its improved bottom-up story offer enough margin of safety to accommodate our more cautious iron ore view," Ribiero said, giving the stock a price target of $11.50. That represents nearly 27% upside from Friday's close. U.S.-traded shares of Vale are up 3% in 2025, and the stock pays a dividend yield of 9.1%. Latam Airlines Group of Chile also made the list. Shares are up 37% in 2025, and the stock pays a dividend yield of 2.7%. Consensus price targets call for 23.2% upside from current levels, per FactSet. Morgan Stanley is overweight on the stock, and analyst Jens Speiss said in a June 10 note that traffic for the airline is up 9.8% quarter to date, topping consensus estimates. "Schedules point to capacity increasing ~11% in June, implying capacity growth of ~8-9% for the full quarter, slightly above consensus (+6.8% Y/Y) and [Morgan Stanley's estimates of] (+7.6%)." — CNBC's Nick Wells and Michael Bloom contributed reporting.
Business Times
21-06-2025
- Business
- Business Times
US may target Samsung, Hynix, TSMC operations in China: sources
[BENGALURU] The US Department of Commerce is considering revoking authorisations granted in recent years to global chipmakers Samsung, SK Hynix and Taiwan Semiconductor Manufacturing Company (TSMC), making it more difficult for them to receive US goods and technology at their plants in China, according to sources familiar with the matter. The chances of the United States withdrawing the authorisations are unclear. But with such a move, it would be harder for foreign chipmakers to operate in China, where they produce semiconductors used in a wide range of industries. A White House official said the United States was 'just laying the groundwork' in case the truce reached between the two countries fell apart. But the official expressed confidence that the trade agreement would go forward and that rare earths would flow from China, as agreed. 'There is currently no intention of deploying this tactic,' the official said. 'It's another tool we want in our toolbox in case either this agreement falls through or any other catalyst throws a wrench in bilateral relations.' Shares of US chip equipment makers that supply plants in China fell when The Wall Street Journal first reported the news earlier on Friday (Jun 20). KLA dropped 2.4 per cent, Lam Research fell 1.9 per cent and Applied Materials sank 2 per cent. Shares of Micron, a major competitor to Samsung and SK Hynix in the memory chip sector, rose 1.5 per cent. A TSMC spokesperson declined to comment. Samsung and Hynix did not immediately respond to requests for comment. Lam Research, KLA and Applied Materials did not immediately respond, either. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up In October 2022, after the United States placed sweeping restrictions on US chipmaking equipment to China, it gave foreign manufacturers such as Samsung and Hynix letters authorising them to receive goods. In 2023 and 2024, the companies received what is known as Validated End User (VEU) status in order to continue the trade. A company with VEU status is able to receive designated goods from a US company without the supplier obtaining multiple export licenses to ship to them. VEU status enables entities to receive US-controlled products and technologies 'more easily, quickly and reliably', as the Commerce Department website puts it. The VEU authorisations come with conditions, a source familiar with the matter said, including prohibitions on certain equipment and reporting requirements. 'Chipmakers will still be able to operate in China,' a Commerce Department spokesperson said in a statement when asked about the possible revocations. 'The new enforcement mechanisms on chips mirror licensing requirements that apply to other semiconductor companies that export to China and ensure the United States has an equal and reciprocal process.' Industry sources said that if it became more difficult for US semiconductor equipment companies to ship to foreign multinationals, it would only help domestic Chinese competitors. 'It's a gift,' one said. REUTERS
CNBC
10-06-2025
- Business
- CNBC
Uncertainty looms as 2025 nears the halfway mark. How to make sure your portfolio is prepared
Stocks have made a recovered from this year's lows, but uncertainty remains a key theme as the second half of the year approaches – and investors can prepare for it. President Donald Trump's rollout of sharply higher tariffs in April sent stocks on a wild ride, with the S & P 500 at one point dipping more than 20% from its all-time high. Traders' hopes for progress in trade negotiations, along with solid first-quarter earnings, helped the market recover since then, however. The S & P 500 is now less than 2% below its its all-time high. Don't just kick back and wait for a continued recovery, though. "Our little tagline here is 'diversifying for resilience,'" said Michael Arone, SPDR chief investment strategist at State Street Global Advisors. "The thought behind the theme for the second half, is that markets are in suspense," he said. Some of the issues for investors to cinsider now include trade policy, soft economic data and the chance that the Federal Reserve holds off on rate cuts for too long, Arone added. Here's how to get your portfolio ready for the remainder of the year Review and rebalance Ignoring your portfolio's asset allocation, particularly at a time when markets are strong, can result in lopsided positions. For starters, think about how large-cap tech stocks in the U.S. were responsible for the market's surge last year. Failure to prune some of those big positions now, and add to underweight sectors, could result in a portfolio that doesn't reflect your goals and risk appetite. This year, investors who shied away from international markets may have found themselves missing out on sizable appreciation. Consider that the Vanguard FTSE All-World ex-US ETF (VEU) has returned 16% in 2025, while the S & P 500's return over the same period is a little more than 2%. VEU .SPX YTD mountain The Vanguard FTSE All-World ex-US ETF (VEU) versus the S & P 500 in 2025 "If we look through a stock lens, U.S. allocation peaked at 67%, and today it's at 64%," said Arone. "I can tell you there are very few investors I meet with who have 36% of their portfolio invested outside of the U.S. from a stock standpoint." Diversifying into international funds also helps investors gain exposure to sectors outside of Big Tech, said Christine Benz, director of personal finance and retirement planning for Morningstar. "The U.S. is still very tech dominated and growth leaning, but broad non-U.S. indexes are dominated by financials and health care. It's a different set of market components relative to the U.S." Benz likes the idea of investors using a broad global stock benchmark as a guide to determine how much to invest overseas, noting that the split is generally about 60% toward the U.S. and 40% non-U.S. Reassess your goals and risk appetite The market's slide in April might have been a good chance for investors to do a gut check of whether their asset allocation reflects the risk they are willing to take. "My big [issue] is the value of derisking for people who are getting close to retirement," said Benz. "It might not have felt like a great idea to derisk in the throes of tariff-related market losses, but now stocks have clawed their way back into positive territory." Investors who are nearing retirement might want to consider adding safer assets to their portfolios to take advantage of today's higher yields, she added. "Consider taking advantage of the fact that yields are decent today and it will translate to better returns for fixed income versus when yields were very low," said Benz. For savers in retirement plans, this can also mean reviewing where you're directing your contributions. "Let's say you're not ready to retire, but retirement is in the next five to 10 years," said Marguerita Cheng, CFP and chief executive officer of Blue Ocean Global Wealth in Gaithersburg, Md. "You can have some of your existing dollars in something a little more conservative, and when you dollar-cost average you can be a little more growth oriented," she said. Dollar-cost averaging refers to making incremental investments into a certain asset at fixed intervals, say every two weeks, every month or every quarter. By spreading out these investments, you're buying into stocks at different prices over time, instead of trying to wait for the "right" time. Tax-loss harvesting Tax-loss harvesting opportunities may await investors who have taxable brokerage accounts. This involves selling losing positions and using the realized losses to offset gains elsewhere in the portfolio. Be sure to avoid violating the wash-sale rule, which involves selling an asset at a loss and then buying a "substantially identical" security within 30 days before or after the transaction. In such cases, the IRS can block you from taking the loss. Lagging stock sectors this year include energy, health care and consumer discretionary, which might all be solid contenders for tax-loss sales. "Investors with individual stocks, sector funds or ETFs might have an opportunity to take a tax loss in those areas," said Benz.
Forbes
04-05-2025
- Business
- Forbes
Bet Against America? This Growing 9.5% Dividend Says ‘No Way'
Flag hanging on a facade getty Are US stocks set to lose out to the rest of the world forever? That's what the press would have us believe. But we contrarian dividend investors are looking at this from a different angle. Our strategy? Buy America when the rest of the world is selling. It's worked before, and we have every reason to believe it will work now, too. So let's talk about it—and the best way to position ourselves for US stocks' next leg up, with a healthy dividend payout on the side. It's funny, but not surprising, that the moment 'sell America' became a headline earlier this year, US stocks started to recover. That said, they are still behind the rest of the world, as we can see by the performance of a popular S&P 500 index fund (in purple below) compared to the Vanguard FTSE All-World ex-US ETF (VEU), in orange. SPY Bounces Back Ycharts Note that both US and global stocks fell about the same amount when the Trump administration announced big global tariffs on April 2. But global stocks recovered more quickly in the following days. And then, last week, US stocks started to catch up. History tells us that they're likely to do much more than catch up in the long run. SPY Long Term Winner Ycharts Going back to VEU's IPO in 2007, the S&P 500 has returned 9.9% per year on average, as of this writing, while VEU returned just 3.9% annualized. This shows why buying US stocks when they lag is a winning move in the long run. We can see that more clearly when we go back to the last time the world soured on US stocks in favor of foreign alternatives, which was a bit over a year ago in February 2024. Back then, Reuters wrote, 'Investors dumped US shares, bought China in week to Wednesday.' At the time, Chinese stocks—shown in blue below by the performance of the iShares MSCI China ETF (MCHI)—were more than doubling their US cousins (in purple), which were themselves lagging global stocks (in orange) by a bit. SPY February 2024 Ycharts As we can see below by looking at Chinese stocks, that country's markets did hold their value for the rest of 2024, but US stocks surpassed those of the rest of the world and started to close the gap with Chinese stocks by the end of the year. SPY Bounces Ycharts And in the longer run, Chinese stocks trail. If we go back to MCHI's IPO in 2011, we see that it has badly lagged US and global stocks, being almost flat: SPY Wealth Creation Ycharts So, time and time again we see the same pattern: For us long-term investors, then, it makes sense to take advantage of the recent lag in US stocks to buy—and position ourselves for a bigger return over the long haul. One of the best ways to do so is through a closed-end fund (CEF) called the Liberty All Star Equity Fund (USA), which yields a rich 9.5% as I write this. USA holds well-known US large caps in a diversified portfolio, with Microsoft (MSFT), (AMZN), Visa (V), Capital One (COP) and many others as top positions. The fund also focuses on firms with strong cash flow, 'moats' in their business models that help them fend off competitors, and histories of strong returns. It also 'translates' those profits into that huge income stream for investors who buy now. Moreover, USA (in blue below) has outrun global and Chinese stocks in the last decade. USA Total Returns Ycharts USA's big dividend didn't just hold steady over this period, it grew, as the fund pays out a percentage of its net asset value (NAV, or the value of its underlying portfolio) as dividends. USA Distribution Ycharts By investing in USA, we're getting a huge and reliable income stream that stands the test of time. And now that the market has sold off, there's an opportunity to buy before we go back to the norm of American outperformance. Which brings me to the fund's discount to NAV: As I write this, USA trades around par. That makes it a good trade now. But if you want to maximize the gains you collect in addition to that huge 9.5% dividend, it could pay to wait for the next dip—and the chance to buy at a discount. Michael Foster is the Lead Research Analyst for Contrarian Outlook. For more great income ideas, click here for our latest report 'Indestructible Income: 5 Bargain Funds with Steady 8.6% Dividends.' Disclosure: none
Forbes
17-04-2025
- Business
- Forbes
VEU Vs. VXUS: Which Of These Vanguard ETFs Is Best For Those Looking To Diversify?
Both VEU and VXUS are excellent international ETFs with unique benefits depending on your investment ... More priorities and existing portfolio composition. Investor concerns over the breakout of a global tariff war have eased after the White House announced a 90-day pause on new duties and negotiations with over 75 countries on trade deals. If successful, these negotiations could prevent trade reduction, supply-chain disruptions, and a rise in consumer prices. These negotiations underscore why international diversification is essential to reduce reliance on a single market. For investors seeking to diversify their portfolios with an international ETF, VEU and VXUS, both offered by Vanguard, are top contenders. These funds both offer international exposure, void of U.S. holdings, but they differ in their strategy, national exposure and number of holdings. By understanding the key differences between these funds and in which situations either would be preferable, investors can choose the right fund for their portfolio. In this guide, you'll learn how VEU and VXUS differ by market exposure, expense ratio, holdings and more, as well as how to make the final determination of which fund is right for you. VEU and VXUS are both ETFs made up of international stock holdings from Vanguard, the firm known for revolutionizing low-cost investing with Vanguard index funds, intended to offer investors exposure to non-U.S. stocks. Both funds can be used to diversify your portfolio with international stocks, each with unique strategies to accomplish this goal. VEU tracks the FTSE All-World ex-US Index which provides broad exposure to developed and emerging markets outside of the United States. VEU has over 3,000 holdings from Europe, Asia and Latin America providing significant exposure to international markets. VEU makes it easy to gain international exposure while avoiding overlap with U.S. stocks, including the best stocks for 2025. This ETF is ideal for investors seeking broad diversification in international markets with a focus on large and mid-cap stocks. VEU is more focused on developed markets than emerging markets and its large positions include Taiwan Semiconductor, Tencent, SAP, Alibaba, and Novo Nordisk. VEU has a low expense ratio of just 0.04% and net assets of $59.54B. VXUS tracks the FTSE Global All Cap ex-US Index which includes small, mid and large-cap stocks from across the world with the exception of the United States. This ETF provides broader exposure to international stocks than VEU with more exposure to small-cap stocks and emerging markets than VEU. With holdings of over 7,000 stocks, VXUS is ideal for investors seeking more granular market exposure. VXUS' primary holdings overlap with VEU including Taiwan Semiconductor, Tencent, SAP, Alibaba, and Novo Nordisk but with slightly lower percentage holdings in these than VEU as it has more total holdings. Like VEU, VXUS' primary sector holdings include Financial Service, Industrials, Technology, Consumer Cyclical and Healthcare. VXUS has higher net assets than VEU of $455.42B and a slightly higher expense ratio of 0.05% VEU and VXUS both provide international exposure but they differ in their strategies and holdings. VEU's holdings are concentrated in mid and large-cap stocks in developed and emerging markets. This ETF excludes U.S. stocks and also has fewer holdings. VXUS provides more broad exposure with small-cap holdings in addition to mid and large-cap stocks. This fund composition provides more diversification to investors and is ideal for investors seeking more complete international exposure. While its inclusion of small-cap stocks can increase volatility, it also can offer greater potential for growth. Datawrapper link: VEU has holdings of over 3,000 stocks from more than 45 countries with the exception of the U.S. This fund has more concentrated holdings in developed markets with heavy weightings in Europe and Asia. While it does provide emerging market exposure, it provides less than VXUS. VXUS has holdings of over 7,000 stocks with broader exposure across emerging markets than VEU with more diversity in market capitalizations of its holdings. These attributes make VXUS more ideal for investors seeking full international exposure. In light of recent tariff news, VEU's limited allocation to small cap stocks, many in emerging markets, may serve as a risk if trade deals aren't reached with specific trading partners like the EU for example. VXUS' broader inclusion of small caps and emerging market holdings may reduce the effect of any one region's tariffs. VEU and VXUS both boast low expense ratios with VEU charging just a 0.04% expense ratio and VXUS charging 0.05%. While both funds are cost-effective, VEU's marginally lower cost may appeal to more investors seeking to minimize fees. For investors seeking broader diversification, VXUS' higher fee may be worthwhile. VEU maintains lower trading volume than VXUS which may result in wider bid-ask spreads. Long-term investors won't be as affected by this difference but it is relevant for traders who need higher liquidity from their ETFs. VXUS offers greater liquidity and higher trading volume than VEU, making it also more ideal for institutional investors. Both VEU and VXUS offer attractive dividend yields with VXUS edging out VEU with a 3.15% yield versus 3.03%. For investors seeking more income from funds in their portfolio, VXUS may be preferable. Dividend yields can change year to year due to payouts from holdings. VEU and VXUS have had similar performance over the last 10 years due to similar holdings and primary exposure to the same markets. Despite this common trend, VEU has outperformed VXUS in both the short and longer term. VEU's 1-year return is 7.02% while VXUS' 1-year return is 6.62%. Likewise, VEU's 3-year return is 5.00% while VXUS returned 4.58%. In comparison, VOO, Vanguard's S&P 500 ETF had a 1-year return of 6.93% and a 3-year return of 8.81%. Despite VOO's outperformance in the 3-year return, VEU and VXUS can offer valuable diversification for domestic-heavy portfolios. For more information on two of the primary U.S. ETFs offered by Vanguard to consider, read this helpful guide: VTI vs VOO. Investors should choose VEU or VXUS based on their investing objectives, portfolio composition and risk tolerance. If you want a fund with a history of higher performance and more concentration in developed markets, VEU would be a better fit. If you prefer broader international exposure and more diversification in cap size, VXUS is a better fit. You want a fund with more focus in large and mid-cap stocks but without U.S. exposure. VEU is also a better fit if you wish to invest in larger, established international stocks with a lower expense ratio and a better history of performance. VEU could also be the right fund for you if you wish for lower volatility in the portfolio and less portfolio churn due to less exposure to small-cap stocks and stocks from developing nations. You want broader international market exposure with more small-cap and emerging market stocks. For investors seeking more total-market exposure with a higher dividend yield, VXUS is an ideal fit. If you're also seeking more liquidity in your fund and slightly tighter bid-ask spreads, choose VXUS. VXUS may also be a better fit for investors who want more diversification in their international fund, have a longer time horizon, and can tolerate more volatility for potentially higher long-term gains. Bottom Line Both VEU and VXUS are excellent international ETFs with unique benefits depending on your investment priorities and existing portfolio composition. VXUS is a superior fit for investors seeking broad market exposure and higher yield. VEU is a better fit for investors who are conscious of fees, want to invest primarily in international blue-chip stocks, and prefer a history of higher performance. Ultimately, both ETFs provide strong international exposure so your selection will be determined by how much you weigh the marginal differences in these ETF's features. Yes, VXUS includes holdings from emerging markets including China, Brazil and India. VXUS offers slightly better long-term growth potential due to small-cap and emerging market stocks being included in its index. Both VEU and VXUS are tax efficient, as ETFs are more tax efficient than index funds. Both ETFs are subject to foreign tax withholding if you're a U.S. investor. It would be unnecessary to hold both VEU and VXUS as these ETFs have significant overlap in their holdings and purpose so it would be more efficient to hold just one.
