For investors seeking momentum, Pacer U.S. Cash Cows 100 ETF (COWZ Quick QuoteCOWZ - Free Report)  is probably on radar. The fund just hit a 52-week high, and is up 28.1% from its 52-week low of $39.15 per share.

But are more gains in store for this ETF? Let’s take a quick look at the fund and the near-term outlook on it to get a better idea of where it might be headed:

COWZ in Focus

The underlying Pacer US Cash Cows 100 Index uses an objective, rules-based methodology to provide exposure to large and mid-capitalization U.S. companies with high free cash flow yields. The ETF charges 49 basis points in fees and yields 1.39% annually.

Why the Move?

The global market is currently at a critical juncture right now due to the pandemic-driven supply-chain woes and the Russia-Ukraine war. With a number of deterrents doing the rounds in the market, it is wise to look for quality while picking stocks. Since we know that a cash cushion is always needed in a rough market, one can easily look at the indicators related to cash flows to measure a company's performance.

One important factor that makes free cash flow a highly dependable metric is that operating cash flow adds back non-cash charges such as depreciation and amortization to net income, genuinely diagnosing a company's financial health. Plus, Pacer did not just focus on free cash flow, as the issuer looks at free cash flow yield as one of the most important metrics. This ensures that the fund target those companies that are generating cash in a robust way compared to their enterprise values.

More Gains Ahead?

The fund has a positive weighted alpha of 22.92. So, there is a decent outlook ahead for those who want to ride this surging ETF a shade further.

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