RNDV's Holdings Could Mean 19% Gain Potential

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Looking at the underlying holdings of the ETFs in our coverage universe at ETF Channel , we have compared the trading price of each holding against the average analyst 12-month forward target price, and computed the weighted average implied analyst target price for the ETF itself. For the US Equity Dividend Select ETF (Symbol: RNDV), we found that the implied analyst target price for the ETF based upon its underlying holdings is $24.31 per unit.

With RNDV trading at a recent price near $20.43 per unit, that means that analysts see 18.98% upside for this ETF looking through to the average analyst targets of the underlying holdings. Three of RNDV's underlying holdings with notable upside to their analyst target prices are KLA-Tencor Corp (Symbol: KLAC), Kohl's Corp. (Symbol: KSS), and Ford Motor Co. (Symbol: F). Although KLAC has traded at a recent price of $89.51/share, the average analyst target is 42.75% higher at $127.78/share. Similarly, KSS has 29.70% upside from the recent share price of $61.24 if the average analyst target price of $79.43/share is reached, and analysts on average are expecting F to reach a target price of $10.86/share, which is 27.44% above the recent price of $8.52. Below is a twelve month price history chart comparing the stock performance of KLAC, KSS, and F:

KLAC, KSS, and F Relative Performance Chart

Below is a summary table of the current analyst target prices discussed above:

Name Symbol Recent Price Avg. Analyst 12-Mo. Target % Upside to Target
US Equity Dividend Select ETF RNDV $20.43 $24.31 18.98%
KLA-Tencor Corp KLAC $89.51 $127.78 42.75%
Kohl's Corp. KSS $61.24 $79.43 29.70%
Ford Motor Co. F $8.52 $10.86 27.44%

Are analysts justified in these targets, or overly optimistic about where these stocks will be trading 12 months from now? Do the analysts have a valid justification for their targets, or are they behind the curve on recent company and industry developments? A high price target relative to a stock's trading price can reflect optimism about the future, but can also be a precursor to target price downgrades if the targets were a relic of the past. These are questions that require further investor research.

10 ETFs With Most Upside To Analyst Targets »

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Investing , ETFs
Referenced Symbols: RNDV , KLAC , KSS , F

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