There are many investing strategies — including value investing, investing to focus
on shareholder yield, or investing in companies with a low dividend payout ratio.
I talked about something
called shareholder yield, which I think is far more important than just a company's dividend yield.
Studies have shown that the dividend yield is most most useful in conjunction with other measures
of shareholder yield including net buybacks and net debt reduction.
Rather than doing «passive market cap investing» thing, they invest you in a variation of their Trinity Portfolio, based on your risk level, which involves holding some of the Cambria Smart Beta ETFs, including the popular
Cambria Shareholder Yield ETF, and trend following.
SYLD invests in 100 stocks with market caps greater than $ 200 million that rank among the highest
in shareholder yield, which is calculated as a combination of cash dividends, share repurchases, and paying down debt.
I made my «Meb
Faber Shareholder Yield backtest» screen public on Portfolio123, so you can search for it and try it out on the site.
-LSB-...] a combination of increasing dividends and aggressive share repurchases, Chubb's
high shareholder yield allows it to give investors -LSB-...]
Effective July 31, 2013, Epoch Investment Partners, Inc. became the portfolio adviser for the Epoch Global
Shareholder Yield Fund (formerly TD Global Dividend Fund).
Through a combination of increasing dividends and aggressive share repurchases, Chubb's high
shareholder yield allows it to give investors good returns even without core growth, and in this case, the company would have roughly doubled your money if you had invested seven years ago and reinvested all dividends.
The following 5 charts display the quintile returns
for shareholder yield in red and the S&P 500 Equal Weight Index in blue.
With a buyback yield of 7 % ttm and a dividend yield of 1 % ttm that means Lear also provides a
nice shareholder yield of 8 %.
However, to avoid issues with stock splits, I'm going to
define shareholder yield as follows: (DivPaid (0, TTM) + DbtTotPYQ - DbtTotQ + (EqPurch (0, TTM)- EqIssued (0, TTM)-RRB--RRB- / mktcap What do you think of that definition?
Shareholder Yield shows how much money a company is paying out to its shareholders through a combination of dividends and share repurchases to reduce the number of shares.
That is, a low P / E gets a low percentile ranking while a high
Shareholder Yield gets a low percentile ranking.
In the case of SYLD, the manager chooses what he considers to be the top 100 stocks based
on shareholder yield, as well as the portfolio weights.
The second part of this series will review the Cambria Foreign
Shareholder Yield ETF (FYLD) and the Cambria Global Value ETF (GVAL).
The following table presents certain technical indicators for ETFs tracking the Cambria Foreign
Shareholder Yield Index.
More complete measures
of shareholder yield, which account for net share repurchases, perform better.
I feel that the Meb
Faber shareholder yield is really a measure of how shareholder friendly a company is when disbursing its profits.
Once you take a more holistic view of cash distributions, what we
call shareholder yield, the picture changes yet again...
Does anyone know how to assign the lowest percentile rank to the
highest Shareholder Yield, when the other factors are assigned a low percentile for their low ratios?
We feel this provides the best trade - off in terms of valuations,
shareholder yield, growth expectations and the potential to buffer some of the downside if markets sell off.
Value here is a combination of P / E, P / S, EBITDA / EV, FCF / EV and
Shareholder Yield (deciles rebalanced annually).