The Cash Cows ETF Series

GCOW

Pacer Global Cash Cows Dividend ETF

A strategy driven exchange traded fund that attempts to provide a continuous stream of income and capital appreciation over time by screening for companies with a high free cash flow yield and a high dividend yield.

  • Free cash flow is the cash remaining after a company has paid expenses, interest, taxes, and long-term investments. It is the source from which dividends are paid.
  • The ability to generate a high free cash flow yield indicates that a company has the capacity to pay dividends. Paying a dividend signals management is confident in the long-term viability of the business.
  • Dividends are a source of income to investors.


Impact of Current Dividend Yield (as of 3/31/17)1

1. Capital Appreciation
Using free cash flow yield to measure the sustainability of a company may produce a higher return with lower volatility over time.
 

2. Reduced Volatility
Companies with a high free cash flow yield and a high dividend yield have historically declined less in market downturns.


3. Yield
Companies with a high free cash flow yield are better positioned to grow and maintain their dividends, but there is no guarantee dividends will be paid.


 



 


(1)Dividend yield is the annual percentage of return earned by an investor on a common or preferred stock. The yield is calculated by dividing the amount of the 12 month dividends per share by the current market price per share of the stock. There is no guarantee dividends wil be paid.
Source(s): FactSet


Pacer Global Cash Cows Strategy Overview

An objective rules-based methodology that uses a quality and value screens to select top companies in the index universe.
All data as of December 2016 semi-annual rebalance.

Top 100 companies with the highest free cash flow yield and highest dividend yield.

  • Weighted by dividends (highest trailing twelve month)
  • Holdings capped at 2% for each company at time of rebalance
  • Reconstituted and rebalanced semi-annually in June and December

Pacer Global Cash Cows Dividend Index Characteristics

as of 3/31/17

Weighted Average Market Cap ($mil) 79,696.96
Dividend Yield (%) 4.04
Free Cash Flow Yield (%) 5.20
Price to Earnings (P/E) Ratio 18.31

Source: FactSet
(1)The individual components of the index are weighted by their total market capitalization. Market capitalization is determined by multiplying each company’s market price by their total outstanding shares. Companies are ranked in descending order based on their market cap in dollars.
(2)Financial companies, other than real estate investment trusts (REITs), are excluded from the Index universe. In addition, companies with negative free cash flow are excluded based on FactSet analyst consensus estimates for average projected FCF and earnings over the next two years.
(4)Remaining 100 companies are weighted by their trailing twelve month dividends. Dividend weighting is calculated by adding the 100 companies’ dividends and dividing the total by each company’s trailing 12 month dividends.
Definitions
Free Cash Flow (FCF): A company’s cash flow from operations minus capital expenditures (expenses, interest, taxes, and long-term investments)
Enterprise Value (EV): A company’s market capitalization, adjusted to eliminate any capital structure bias (i.e. by adding debt and subtracting cash or cash equivalents)
(3)Free Cash Flow Yield: FCF/EV. Measures a company’s total free cash flow relative to its enterprise value. This is an internal statistic and does not constitute investor yield.

Current Holdings

Daily Holdings

Performance

as of 3/31/17

  Since Fund Inception (2/22/16) YTD 1-Year 3-Year 5-Year
Pacer Global Cash Cows Dividend ETF Market Price 15.44 7.01 9.07 - -
Pacer Global Cash Cows Dividend ETF NAV 14.93 6.57 9.24 - -
Pacer Global Cash Cows Dividend Total Return Index 15.94 6.62 9.99 - -
Pacer Global Cash Cows Dividend Price Return Index 11.62 5.75 6.06 - -
FTSE Developed Large-Cap Index 20.42 6.78 15.80 6.16 9.79

Monthly Performance

Source: FTSE and US Bank.

This is a new Fund and therefore has limited performance to report. Performance quoted represents past performance and does not guarantee future results. Investment return and principal value will fluctuate, so shares may be worth more or less when redeemed or sold. Current performance may be lower or higher than the performance quoted. Visit http://www.paceretfs.com for the most recent month-end performance. Index returns are for illustrative purposes only. Index performance does not reflect any management fees, transaction costs or expenses. You cannot invest directly in an index.

Total return is the actual rate of return of an investment over a given evaluation period. Total return includes interest, capital gains, dividends and distributions realized over a given period of time.

Distributions

Ex Date Total Distributions Ordinary Income* Short Term Capital Gains Long Term Capital Gains Return of Capital
3/28/2017 $0.17259276 $0.17259276 $0 $0 $0
12/28/2016 $0.22806600 $0.22806600 $0 $0 $0
9/13/2016 $0.11591613 $0.11591613 $0 $0 $0
6/14/2016 $0.17877886 $0.17877886 $0 $0 $0

2017 Distribution Schedule

Past distributions are not indicative of future distributions.

Current Holdings

Daily Holdings

Index Characteristics

as of 3/31/17

  Pacer Global Cash Cows Dividend Index FTSE Developed Large-Cap Index
Weighted Average Market Cap ($mil) 79,696.96 136,479.56
Free Cash Flow Yield (%) 5.20 3.68
Dividend Yield (%) 4.04 2.47
Price/Earnings 18.31 19.72

Top 10 Holdings (%)

as of 3/31/17

Pacer Global Cash Cows Dividend ETF FTSE Developed Large-Cap Index
Ticker Holding Weight Ticker Holding Weight
TEF Telefonica SA 2.51 AAPL Apple, Inc. 2.50
PM Phillip Morris International Inc. 2.35 MSFT Microsoft Corporation 1.65
UNA Unilever NV Cert of shs 2.32 XOM Exxon Mobil Corporation 1.14
BAYN Bayer AG 2.25 JNJ Johnson & Johnson 1.13
ROG Roche Holding Ltd. Genusssch. 2.15 AMZN Amazon.com, Inc. 1.13
CSCO Cisco Systems, Inc. 2.12 JPM JPMorgan Chase & Co. 1.05
NESN Nestle SA 2.10 FB Facebook, Inc. Class A 1.05
SAN Sanofi 2.07 WFC Wells Fargo & Company 0.93
ABBV AbbVie, Inc. 2.01 GE General Electric Company 0.87
MCD McDonald's Corporation 2.01 T AT&T, Inc. 0.85
Total 21.89 Total 12.30

Sector Breakdown (%)

as of 3/31/17

  Weight
Health Care 17.19
Telecommunication Services 16.97
Consumer Staples 15.32
Consumer Discretionary 12.36
Information Technology 11.76
Industrials 9.11
Real Estate 5.56
Utilities 4.51
Materials 4.30
Energy 2.92

Top 10 Country Breakdown  (%)

as of 3/31/17

Pacer Global Cash Cows Dividend ETF FTSE Developed Large-Cap Index
Country Weight Country Weight
United States 35.68 United States 58.49
United Kingdom 10.00 Japan 8.64
Switzerland 9.74 United Kingdom 6.43
France 6.13 Germany 3.63
Japan 4.85 France 3.55
Spain 4.54 Switzerland 3.44
Netherlands 4.46 Australia 3.22
Australia 4.39 Canada 2.74
South Korea 3.56 Korea 1.94
Sweden 2.84 Hong Kong 1.56
Total 86.19 Total 93.64

Weighted average market cap is the sum of each company's weight multiplied by its market cap.
Dividend yield is calculated using the gross dividend of a security (i.e., before any applicable withholding tax). Special cash dividends, unless they are paid for three consecutive years, and capital repayments are excluded from the dividend yield calculation.
FTSE Developed Large-Cap Index is a market-capitalization weighted index representing the performance of large-cap stocks in developed markets.

Source: FTSE International Limited (“FTSE”) © FTSE 2016. “FTSE®” is a trade mark of the London Stock Exchange Group companies and is used by FTSE International Limited under license. All rights in the FTSE indices and / or FTSE ratings vest in FTSE and/or its licensors. Neither FTSE nor its licensors accept any liability for any errors or omissions in the FTSE indices and / or FTSE ratings or underlying data and no party may rely on any FTSE indices, ratings and / or data underlying data contained in this communication. No further distribution of FTSE Data is permitted without FTSE’s express written consent. FTSE does not promote, sponsor or endorse the content of this communication.

 

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