The Cash Cows ETF Series

Cash Cows Index Strategy

• Free cash flow is the cash remaining after a company has paid expenses, interest, taxes, and long-term investments. It can be used to buy back stock, pay dividends, or participate in mergers and acquisitions.
• The ability to generate a high free cash flow yield indicates a company is producing more cash than it needs to run the business and can invest in growth opportunities.
• Watch to learn more about how Pacer Cash Cows Index ETFs work.

Free Cash Flow Yield Comparison

as of 12/31/2019

1. High-Quality U.S. Large & Mid Cap Companies
Focus on quality large cap and mid cap companies with high free cash flow yield.

2. Growth Companies Trading at a Discount
Offers exposure to opportunities in the market where growth stocks are trading at a discount.

3. Long-Term Capital Appreciation
Using free cash flow yield to measure the sustainability of a company may produce potentially higher returns and more attractive upside/downside capture over time.

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)
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.
Upside/Downside capture: Upside/downside capture ratio show you whether a given fund has outperformed--gained more or lost less than--a broad market benchmark during periods of market strength and weakness

Pacer US Cash Cows Growth Strategy Overview

An objective rules-based methodology that uses a quality screen to select top companies in the index universe.
All data as of December 2019 quarterly rebalance.

(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)The S&P 900 Pure Growth Index is made up of approximately 150 companies that exhibit strong growth characteristics from the S&P 500 and S&P MidCap 400. The initial universe of companies is screened based on their average projected free cash flows and earnings (if available) over each of the next two fiscal years. Companies with negative average projected free cash flows or earnings are removed from the Index universe. Financial companies, other than real estate investment trusts (“REITs”), are excluded from the Index universe.
(3)At the time of each rebalance of the Index, the companies included in the Index are weighted in proportion to their current market capitalization.