Goldman Sachs: Yields Rising on Growth Optimism, Benefitting Cyclicals; SCHD ETF a Quality Dividend Play
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Goldman Sachs notes economic data improving, implying yields rising due to growth optimism rather than inflation fears. This benefits cyclical sectors like consumer discretionary and industrials.
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SCHD ETF offers diversified exposure to high dividend stocks with quality characteristics. It has an A+ grade given its low fees and 3.4% dividend yield.
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The ETF is overweight energy and underweight tech compared to S&P 500. Its value tilt should benefit from economic momentum shifting toward cyclicals.
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SCHD broke out from a technical downtrend in late 2022. Its price target based on previous pattern is $88, but momentum is currently weakening.
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While SCHD has lagged the S&P 500 over the past year, improving growth and rising yields may shift momentum toward its dividend and value strategy.