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After the closing bell on Oct 25, International Business Machines (IBM - Free Report) reported strong third-quarter 2023 results. It beat estimates for earnings but missed the same for revenues. It affirmed its full-year outlook (see: all the Technology ETFs here).
IBM shares rose as much as 2% in aftermarket hours. This has put ETFs having the highest allocation to this tech giant in the spotlight. These funds are First Trust NASDAQ Technology Dividend Index Fund (TDIV - Free Report) , FT Cboe Vest Technology Dividend Target Income ETF (TDVI - Free Report) , FT Cboe Vest DJIA Dogs 10 Target Income ETF (DOGG - Free Report) , Invesco Dow Jones Industrial Average Dividend ETF (DJD - Free Report) and Morningstar Dividend Leaders Index Fund (FDL - Free Report) .
Earnings per share came in at $2.20, surpassing the Zacks Consensus Estimate by 8 cents and improving 22% from the year-ago earnings. Revenues grew 4.6% year over year to $14.75 billion and fell short of the consensus estimate of $14.77 billion.
The earnings beat was driven by resilient demand for software, which contributed to the revenue growth, particularly with the inclusion of the newly acquired IT budgeting software maker, Apptio. However, the revenue miss was due to a strengthening U.S. dollar as many of IBM’s consulting customers are overseas (read: Shutdown Fears Bolster Dollar's Safe Status: ETFs to Bet).
Strong demand at its consulting and software businesses drove the results. Consulting revenues increased 6% and software revenues grew 8% from the year-ago levels.
IBM maintained its sales growth guidance of 3-5% for 2023 in constant currency, suggesting that the company’s focus on software and hybrid cloud services is paying off.
ETFs in Focus
First Trust NASDAQ Technology Dividend Index Fund (TDIV - Free Report)
First Trust NASDAQ Technology Dividend Index Fund provides exposure to dividend payers within the technology and telecommunication sector by tracking the Nasdaq Technology Dividend Index. It charges 50 bps in annual fees and holds about 92 securities in its basket. Of these firms, IBM takes the second spot, making up 8.5% of the assets (read: Should You Play Undervalued Tech ETFs?).
First Trust NASDAQ Technology Dividend Index Fund has amassed $1.9 billion in its asset base while trading in a volume of around 87,000 shares per day.
FT Cboe Vest Technology Dividend Target Income ETF (TDVI - Free Report)
FT Cboe Vest Technology Dividend Target Income ETF is an actively managed fund that seeks to provide a target level of current income and capital appreciation by holding a portfolio of dividend-paying U.S. technology companies. The fund utilizes a naked call writing option strategy on the Nasdaq 100 Index and/or the S&P 500 Index or related ETFs. It holds 92 securities in its basket, with IBM taking the second spot at 8.5% share.
FT Cboe Vest Technology Dividend Target Income ETF has accumulated $1.9 million in its asset base and trades in a volume of 2,000 shares per day on average. It charges 75 bps in annual fees.
FT Cboe Vest DJIA Dogs 10 Target Income ETF (DOGG - Free Report)
FT Cboe Vest DJIA Dogs 10 Target Income ETF seeks to provide current income with a secondary objective of providing capital appreciation. It provides exposure to the "Dogs of the Dow," the 10 highest dividend-yielding stocks in the Dow Jones Industrial Average on an annual basis. DOGG holds 42 stocks in its basket, with IBM occupying the fifth position at 5.7% share.
FT Cboe Vest DJIA Dogs 10 Target Income ETF has accumulated $7 million in its asset base and trades in a volume of 4,000 shares. It charges 75 bps in fees and expenses.
Invesco Dow Jones Industrial Average Dividend ETF (DJD - Free Report)
Invesco Dow Jones Industrial Average Dividend ETF offers exposure to dividend-paying companies included in the Dow Jones Industrial Average by their 12-month dividend yield over the prior 12 months. It holds 28 stocks in its basket, with IBM occupying the fourth position, accounting for 5.7%.
Invesco Dow Jones Industrial Average Dividend ETF has managed assets worth $247 million while trading in a volume of 30,000 shares a day on average. It charges 7 bps in annual fees and has a Zacks ETF Rank #3 (Hold).
First Trust Morningstar Dividend Leaders Index Fund (FDL - Free Report)
First Trust Morningstar Dividend Leaders Index Fund offers exposure to stocks that have shown the highest dividend consistency and dividend sustainability by tracking the Morningstar Dividend Leaders Index. It holds 101 stocks in its basket, with IBM taking the sixth spot at 5.1% share (read: 6 Cheap High-Dividend ETFs to Buy Now).
With AUM of $3.9 billion, First Trust Morningstar Dividend Leaders Index Fund charges 45 bps in annual fees from investors and trades in a solid volume of about 721,000 shares a day. It has a Zacks ETF Rank #3 with a Medium risk outlook.
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ETFs in Focus Post IBM's Q3 Earnings Beat
After the closing bell on Oct 25, International Business Machines (IBM - Free Report) reported strong third-quarter 2023 results. It beat estimates for earnings but missed the same for revenues. It affirmed its full-year outlook (see: all the Technology ETFs here).
IBM shares rose as much as 2% in aftermarket hours. This has put ETFs having the highest allocation to this tech giant in the spotlight. These funds are First Trust NASDAQ Technology Dividend Index Fund (TDIV - Free Report) , FT Cboe Vest Technology Dividend Target Income ETF (TDVI - Free Report) , FT Cboe Vest DJIA Dogs 10 Target Income ETF (DOGG - Free Report) , Invesco Dow Jones Industrial Average Dividend ETF (DJD - Free Report) and Morningstar Dividend Leaders Index Fund (FDL - Free Report) .
Earnings per share came in at $2.20, surpassing the Zacks Consensus Estimate by 8 cents and improving 22% from the year-ago earnings. Revenues grew 4.6% year over year to $14.75 billion and fell short of the consensus estimate of $14.77 billion.
The earnings beat was driven by resilient demand for software, which contributed to the revenue growth, particularly with the inclusion of the newly acquired IT budgeting software maker, Apptio. However, the revenue miss was due to a strengthening U.S. dollar as many of IBM’s consulting customers are overseas (read: Shutdown Fears Bolster Dollar's Safe Status: ETFs to Bet).
Strong demand at its consulting and software businesses drove the results. Consulting revenues increased 6% and software revenues grew 8% from the year-ago levels.
IBM maintained its sales growth guidance of 3-5% for 2023 in constant currency, suggesting that the company’s focus on software and hybrid cloud services is paying off.
ETFs in Focus
First Trust NASDAQ Technology Dividend Index Fund (TDIV - Free Report)
First Trust NASDAQ Technology Dividend Index Fund provides exposure to dividend payers within the technology and telecommunication sector by tracking the Nasdaq Technology Dividend Index. It charges 50 bps in annual fees and holds about 92 securities in its basket. Of these firms, IBM takes the second spot, making up 8.5% of the assets (read: Should You Play Undervalued Tech ETFs?).
First Trust NASDAQ Technology Dividend Index Fund has amassed $1.9 billion in its asset base while trading in a volume of around 87,000 shares per day.
FT Cboe Vest Technology Dividend Target Income ETF (TDVI - Free Report)
FT Cboe Vest Technology Dividend Target Income ETF is an actively managed fund that seeks to provide a target level of current income and capital appreciation by holding a portfolio of dividend-paying U.S. technology companies. The fund utilizes a naked call writing option strategy on the Nasdaq 100 Index and/or the S&P 500 Index or related ETFs. It holds 92 securities in its basket, with IBM taking the second spot at 8.5% share.
FT Cboe Vest Technology Dividend Target Income ETF has accumulated $1.9 million in its asset base and trades in a volume of 2,000 shares per day on average. It charges 75 bps in annual fees.
FT Cboe Vest DJIA Dogs 10 Target Income ETF (DOGG - Free Report)
FT Cboe Vest DJIA Dogs 10 Target Income ETF seeks to provide current income with a secondary objective of providing capital appreciation. It provides exposure to the "Dogs of the Dow," the 10 highest dividend-yielding stocks in the Dow Jones Industrial Average on an annual basis. DOGG holds 42 stocks in its basket, with IBM occupying the fifth position at 5.7% share.
FT Cboe Vest DJIA Dogs 10 Target Income ETF has accumulated $7 million in its asset base and trades in a volume of 4,000 shares. It charges 75 bps in fees and expenses.
Invesco Dow Jones Industrial Average Dividend ETF (DJD - Free Report)
Invesco Dow Jones Industrial Average Dividend ETF offers exposure to dividend-paying companies included in the Dow Jones Industrial Average by their 12-month dividend yield over the prior 12 months. It holds 28 stocks in its basket, with IBM occupying the fourth position, accounting for 5.7%.
Invesco Dow Jones Industrial Average Dividend ETF has managed assets worth $247 million while trading in a volume of 30,000 shares a day on average. It charges 7 bps in annual fees and has a Zacks ETF Rank #3 (Hold).
First Trust Morningstar Dividend Leaders Index Fund (FDL - Free Report)
First Trust Morningstar Dividend Leaders Index Fund offers exposure to stocks that have shown the highest dividend consistency and dividend sustainability by tracking the Morningstar Dividend Leaders Index. It holds 101 stocks in its basket, with IBM taking the sixth spot at 5.1% share (read: 6 Cheap High-Dividend ETFs to Buy Now).
With AUM of $3.9 billion, First Trust Morningstar Dividend Leaders Index Fund charges 45 bps in annual fees from investors and trades in a solid volume of about 721,000 shares a day. It has a Zacks ETF Rank #3 with a Medium risk outlook.