Nuveen Dividend Growth ETF's Average People Pillar and Process Pillar ratings result in a Morningstar Medalist Rating of Neutral. The strategy charges fees in line with its similarly distributed peers, priced within the middle quintile.  

 The strategy benefits from its experienced portfolio management team. This is a positive driver for the strategy's Average People Pillar rating. The strategy merits an Average Process Pillar rating. Independent of the rating, analysis of the strategy's portfolio shows it has maintained a significant underweight position in quality exposure and volatility exposure compared with category peers. Low quality exposure is attributed to stocks with higher financial leverage and lower profitability. And low volatility exposure is rooted in stocks that have a lower standard deviation of returns. The strategy's parent organization earns the firm an Average Parent Pillar rating, and this rating is inherited from vehicles belonging to the same branding entity and is indirectly assigned by an analyst.

Analyst Rating

Microsoft

Apple

Broadcom

Motorola Solutions

JPMorgan Chase & Co

Linde

FleetCor Technologies

UnitedHealth Group

Mastercard

Prologis

Morningstar's evaluation of this security's process aims to determine the likelihood that it will outperform its Morningstar Category benchmark on a risk-adjusted basis over the long term. Nuveen Dividend Growth ETF earns an Average Process Pillar rating. 

The main contributor to the rating is its parent firm's long-term risk-adjusted performance, as shown by the firm's average 10-year Morningstar Rating of 3.1 stars. Respectable risk-adjusted performance also supports the process. This can be seen in the fund's 10-year alpha calculated relative to the category average, which suggests that the managers have shown skill in their allocation of risk. Lastly, the process is limited by the parent firm's five-year risk-adjusted success ratio of 50%. The measure indicates the percentage of a firm's funds that survived and outperformed their respective category's median Morningstar Risk-Adjusted Return for the period. The parent's modest success ratio suggests that the firm could do better across its fund lineup.

 This strategy skews toward smaller, more undervalued companies than its average peer in the Large Blend Morningstar Category. Looking at additional factor exposure, this strategy has consistently favored low-quality stocks compared with Morningstar Category peers over the past few years. Such positions do not tend to provide much ballast for a portfolio. In the latest month, the strategy was also less exposed to the Quality factor compared with Morningstar Category peers. The managers have also shown an underweight risk tilt, demonstrated by lower volatility exposure over peers in recent years. These companies have historically been a valuable ballast to steady portfolio returns during market downturns. Similarly, in recent months, the strategy also had less exposure to the Volatility factor than peers. Additionally, the managers have tended to overweight yield, shown by the portfolio's high exposure to stocks paying dividends or buying back shares. High-yield stocks tend to be connected to more mature companies earning enough cash to return some to shareholders. At times, however, extreme market pressure can force them to cut their dividends, which hurts stock performance. In this month, the strategy also had more exposure to the Yield factor over its peers. More information on a fund and its respective category's factor exposure can be found in the Factor Profile module within the Portfolio section. 

 The portfolio is overweight in real estate by 3.0 percentage points in terms of assets compared with the category average, and its financial services allocation is similar to the category. The sectors with low exposure compared to category peers are communication services and industrials, with communication services underweighting the average portfolio by 5.9 percentage points of assets and industrials similar to the average. The portfolio is positioned across 40 holdings and is less top-heavy than peers. Specifically, 41.7% of the fund’s assets are concentrated within the top 10 fund holdings, as opposed to the category’s 48.8% average. And in closing, in terms of portfolio turnover, on a year-over-year basis, 18% of the fund's holdings have changed, whether through increasing, decreasing, or changing a position.

Average

Process

Nuveen Dividend Growth ETF earns an Average People Pillar rating. The leading factor behind the rating is its parent firm's five-year success ratio of 51%. The measure indicates the percentage of a firm's funds that survived and beat their respective category's median return for the period. The stability of the management team also influences the rating. Specifically, the fund has not seen a manager change in the last three years. Lastly, the rating is limited by the combined average five-year excess return of each manager, which shows that the funds they manage have underperformed their respective category average.


The team is backed by David A Chalupnik, the longest-tenured manager on the strategy, who brings 21 years of listed portfolio management experience. The strategies they currently manage have an average Morningstar Rating of 2.9 stars, demonstrating disappointing risk-adjusted performance compared with category peers. David A Chalupnik has an experienced listed co-manager. Together, they average 13 years of listed portfolio management experience. None of the portfolio managers here invest in this fund. This hurts the rating because manager investment would align their interests with the strategy's investors.

People

Nuveen has accomplished years of refinement, but a handful of areas keep it from landing among the industry’s best. It retains an Average Parent rating.
Nuveen is the asset-management arm of TIAA. TIAA purchased Nuveen in October 2014 and in January 2017 announced that Nuveen would become the umbrella brand for all its asset-management capabilities, including the legacy Nuveen and TIAA investment teams and their affiliates. 
Since then, a dramatic transformation has taken place. This includes merging all but one affiliated investment team into centralized equity and fixed-income groups, which are now among the industry’s largest. All operations, technology, and sales functions were centralized and modernized; in 2019, the firm rolled out a comprehensive long-term incentive plan that has helped attract and retain talent, and the previously expansive investment lineup has been mostly cleaned up.
Nuveen’s investment strengths are predominantly in fixed income and real assets. While its municipal team is among the industry’s more ubiquitous, its aggressive approach has been a sticking point for several years. Its experienced equity team hasn’t distinguished its performance from peers’. Finally, CEO Jose Minaya has built a robust management team, but several of them are recent outside hires and so it will take time to see how they integrate with Minaya’s modernized vision for the firm.

Parent

Nuveen Dividend Growth ETF

NDVG is an actively managed, non-transparent ETF that primarily holds dividend-paying equities from around the globe. The fund utilizes the Natixis/NYSE non-transparent model.

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Nuveen Small Cap Select ETF

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The TIAA subsidiary is launching the ETFs after a two-year hiatus.

Nuveen Launches 3 Active ETFs

Today, August 5, Nuveen announced the launch of three new active ETF offerings, the Nuveen Small Cap Select Fund (NSCS), the Nuveen Santa Barbara Dividend Growth Fund (NDVG), and the Nuveen Winslow Large-Cap Growth ESG Fund (NWLG). All three of Nuveen's new ETFs are actively managed and semi-transparent, which means that holdings are only disclosed monthly.

Nuveen Launches Trio of Actively Managed ETFs

NEW YORK, Aug. 5, 2021 /PRNewswire/ -- Nuveen today launched its first suite of active semi-transparent Exchange Traded Funds (ETFs). Already available as mutual fund strategies, the three semi-transparent active ETFs combine the structural advantages of both the ETF and mutual fund wrappers, with the objective of helping clients meet their financial goals through the investment vehicle of their choice.

News for Nuveen Dividend Growth ETF ETF (NDVG)