FXN Overview

Asset Sale and Future Focus: Matador Resources Co has sold its remaining Eagle Ford shale assets in South Texas to concentrate on developing high-quality acreage in the northern Delaware Basin, where it holds approximately 200,000 net acres.

Financial Position and Stock Considerations: Following the asset sale, Matador repaid $180 million of its borrowings, expects a leverage ratio of one times or lower, and is considering a stock repurchase program amidst a decline in share price.

Featured ETFs: Zacks.com highlights several low-priced ETFs, including SoFi Next 500 ETF, Range Cancer Therapeutics ETF, First Trust Energy AlphaDEX Fund, and Global X SuperDividend U.S. ETF, which are appealing for investors seeking affordability and potential for significant gains.

Investment Considerations: While low-priced stocks and ETFs offer opportunities for diversification and liquidity, they also come with higher volatility risks and potential for price manipulation, making thorough research essential before investing.

Overview of First Trust Energy AlphaDEX ETF: The First Trust Energy AlphaDEX ETF (FXN), launched in 2007, is a smart beta ETF that aims to outperform traditional market cap weighted indices by selecting stocks based on specific fundamental characteristics. It focuses heavily on the energy sector and has an expense ratio of 0.62%.

Performance and Alternatives: FXN has shown a year-to-date gain of 1.68% but is down 4.04% over the past year, indicating high risk with a beta of 1.61. Investors may also consider alternatives like Vanguard Energy ETF (VDE) and Energy Select Sector SPDR ETF (XLE), which offer lower expense ratios and potentially less risk.

Overview of First Trust Energy AlphaDEX ETF (FXN): Launched in 2007, FXN is a smart beta ETF focusing on the energy sector, aiming to outperform traditional market cap weighted indices through its modified equal-dollar weighted StrataQuant Energy Index. It has over $478 million in assets and an expense ratio of 0.62%.

Performance and Comparison: FXN has gained 1.68% this year but is down 4.04% over the past year, with a higher risk profile indicated by a beta of 1.61. Investors may also consider lower-cost alternatives like Vanguard Energy ETF (VDE) and Energy Select Sector SPDR ETF (XLE), which have significantly larger asset bases and lower expense ratios.

Financial Performance: HF Sinclair Corporation reported flat revenues of $7.845 billion for Q2 FY24, with a significant 53% drop in adjusted EBITDA to $405.8 million, primarily due to reduced refinery margins. However, adjusted EPS of $0.78 exceeded expectations.

Dividends and Future Outlook: The company declared a dividend of $0.50 per share, payable on September 5, and highlighted progress in operational efficiency and strategic initiatives across its business segments, despite a 3.81% decline in share price.

First Trust Energy AlphaDEX ETF (FXN):

• Passively managed ETF providing exposure to the Energy - Broad segment of the equity market.
• Popular due to low cost, transparency, flexibility, and tax efficiency for investors.
• Sponsored by First Trust Advisors with assets over $605.25 million.
• Seeks to match the performance of the StrataQuant Energy Index before fees and expenses.
• Has a 12-month trailing dividend yield of 1.99%.

Sector Exposure and Top Holdings:

• FXN has the heaviest allocation in the Energy sector, about 96% of the portfolio.
• Top holdings include Valero Energy Corporation, Ovintiv Inc., and Marathon Oil Corporation.
• The top 10 holdings account for about 42.06% of total assets under management.

Performance and Risk:

• FXN has gained about 8.28% year-to-date and was up about 19.84% in the last one year.
• It has a beta of 1.64 and standard deviation of 29.41%, making it a high-risk choice.
• With approximately 41 holdings, it has more concentrated exposure than peers.

Alternatives:

• FXN holds a Zacks ETF Rank of 2 (Buy) and is suitable for investors seeking Energy ETF exposure.
• Other alternatives include Vanguard Energy ETF (VDE) and Energy Select Sector SPDR ETF (XLE).
• VDE has $8.43 billion in assets with an expense ratio of 0.10%, while XLE charges 0.09%.

Bottom Line:

• Investors can explore FXN and other ETFs matching their investment objectives through Zacks ETF Center.
• Stay informed with Zacks' free Fund Newsletter for top news and analysis on ETFs weekly.