IShares S&P Mid-Cap 400 Value ETF IJJ is a compelling option in the mid-cap value Morningstar Category. Its low fee, broad diversification, and profitable holdings make it hard to beat. 

The fund tracks the S&P MidCap 400 Value Index, which sweeps in stocks from the cheaper half of the S&P MidCap 400 Index. Value stocks are usually characterized by low price/book and low price/earnings ratios. Depressed valuations may be due to slow earnings growth, poor fundamentals, or dim prospects. While these may not be the most exciting firms, the low expectations implied in their valuations should be easier to beat.

Market-cap-weighting is an efficient way to allocate the portfolio because it harnesses the market's consensus opinion of each stock's relative value. Stocks that grow in size take up a larger share of the portfolio, while smaller companies that may be struggling take on a less important role. Market-cap-weighting dials back turnover, too, but strict size constraints may mute this effect, especially in lively years like 2019, when turnover spiked to 44%.

While some peers venture further to the deep value end of the Morningstar Style Box, this fund's approach lends it to include some blend and even growth names in the portfolio. The resulting allocation is more moderate than some peers, but it still effectively captures the value factor and resembles the complexion of the mid-cap value category average.

The S&P MidCap 400 Index operates at the smaller end of the mid-cap market. It collects the next 400 largest profitable companies in the United States, after the S&P 500 amasses the largest 500. Small-cap stocks tend to be more volatile than their larger peers. This fund should benefit from its smaller stance during market upswings but may also fall a little faster during broad selloffs.

Past performance bore this out. In the 10 years through December 2023, the fund outperformed the category average but with more volatility. Risk-adjusted returns still beat the category average—its 1.3-percentage-point total return advantage was more than enough to overcome volatility that was 6.3% higher than its average peer. Over time, the fund’s risky tendencies may persist, but its low fee and broad diversification should support a continued advantage.

Analyst Rating

An appealing mid-cap value ETF.

Analyst

Zachary Evens

Reinsurance Group of America

W. P. Carey

US Foods Holding

Performance Food Group

Ally Financial

Cleveland-Cliffs

Regal Rexnord Corp

Chesapeake Energy

BJ`s Wholesale Club Holdings Inc

Tenet Healthcare

A preference for profitable firms and sound diversification should minimize the risks of the fund's small stock orientation. It earns an Above Average Process Pillar rating.

Above Average

Process

BlackRock's industry-leading technology, global footprint, and extensive supporting cast earn an Above Average People Pillar rating. The team employs BlackRock's Aladdin platform to fulfill much of its portfolio management tasks, and global trading desks allow traders to conduct foreign transactions in a cost-effective way.

The U.S.-based iShares index equity team has endured some internal turnover at the top over the past few years. But index-tracking performance should remain tight, thanks to heavily automated processes, a large team of seasoned professionals, and several long-tenured managers who remain at the helm, such as Greg Savage who has managed this fund since 2008. Amy Whitelaw left the team in February 2023 for another role within the organization. Paul Whitehead replaced Alan Mason as a manager in January 2022, when Mason left to focus on the firm's customized institutional indexing capabilities. The broader index equity group, co-headed by Jennifer Hsui and Whitehead, will continue to oversee iShares equity ETFs.

All managers interact with a wider team of traders and managers around the globe to execute the funds' day-to-day operations. The larger number of managers also limits the impact of personnel turnover when it does occur.

People

BlackRock offers compelling options across asset classes and vehicles. It earns an Above Average rating for Parent. 
The firm’s approximately USD 8 trillion in assets under management, as of Sept. 30, 2022, gives it unparalleled scale and influence. It is a market-leading index fund provider globally, and its iShares exchange-traded fund franchise offers a low-cost lineup of core funds that investors can use to build a well-diversified portfolio for dirt cheap. The firm can be more adventurous in its ETF launches than some peers, so not everything it launches is appropriate for the masses. As a result, it is likely to have more ETF closures than peers that stick to the basic building blocks.  
The firm’s active fixed-income and multi-asset efforts also stand out as some of the best in the industry. Those benefit from BlackRock’s commitment to building a first-class risk management system via its Aladdin analytics software. The software is also available for sale to other firms and has proved to be a popular option for competitors, a testament to its usefulness. 
More recently, the firm has shifted its focus to ESG offerings and incorporating ESG across its investment lineup, leading to a political backlash in the United States.
BlackRock isn’t the best at everything it tries to do, but retail investors, financial advisors, and large institutions could all build robust portfolios using BlackRock’s products.

Parent

iShares S&P Mid-Cap 400 Value ETF

IJJ tracks an index of US mid-cap value firms from the committee-selected S&P 400 using three fundamental factors.

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For the iShares S&P Mid-Cap 400 Value ETF (IJJ), we found that the implied analyst target price for the ETF based upon its underlying holdings is $183.77 per unit.

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For the iShares S&P Mid-Cap 400 Value ETF, we found that the implied analyst target price for the ETF based upon its underlying holdings is $174.93 per unit.

We Did The Math: The iShares S&P Mid-Cap 400 Value ETF Can Go To $175

For the iShares S&P Mid-Cap 400 Value ETF, we found that the implied analyst target price for the ETF based upon its underlying holdings is $176.00 per unit.

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For the iShares S&P Mid-Cap 400 Value ETF, we found that the implied analyst target price for the ETF based upon its underlying holdings is $177.23 per unit.

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For the iShares S&P Mid-Cap 400 Value ETF, we found that the implied analyst target price for the ETF based upon its underlying holdings is $178.07 per unit.

We Did The Math: The iShares S&P Mid-Cap 400 Value ETF Can Go To $178

For the iShares S&P Mid-Cap 400 Value ETF, we found that the implied analyst target price for the ETF based upon its underlying holdings is $179.13 per unit.

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For the iShares S&P Mid-Cap 400 Value ETF, we found that the implied analyst target price for the ETF based upon its underlying holdings is $177.41 per unit.

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For the iShares S&P Mid-Cap 400 Value ETF, we found that the implied analyst target price for the ETF based upon its underlying holdings is $176.95 per unit.

News for iShares S&P Mid-Cap 400 Value ETF ETF (IJJ)