S&P 500 25x Kazançla İşlem Yapar. Bu Temettü ETF'si, Çok Daha Düşük Değerlemelerle İşlem Yapan Hisse Senetlerini Alt Ediyor

The S&P 500 Trades at 25x Earnings. This Dividend ETF Is Beating It With Stocks Trading at Much Lower Valuations

Tony Dong

Sat, September 12, 2026 at 1:36 PM GMT+3 5 min read

• ^GSPC +0.86%
• SPYD +0.48%

Quick Read

• SPYD returned 17.03% cumulative with dividends reinvested YTD through Sept. 1 versus 12.34% for SPYM, benefiting from the resurgence in value-oriented stocks during 2026.

• SPYD's high-dividend screen doubles as a simple value strategy. Its portfolio trades at 17.06 times earnings versus roughly 25 times for the S&P 500, while offering a 4.28% 30-day SEC yield.

• The ETF charges just 0.07% and uses no derivatives, but its high 24.26% real estate allocation makes it less tax efficient than dividend ETFs that exclude REITs.

• Just released. Our analysts combed the entire stock market and named the ten best stocks to buy right now. The report is free. Enter your email and see if any of your stocks made the cut.

Starting valuations have historically been one of the more useful predictors of long-term stock returns. Personally, I prefer measures such as free cash flow yield because earnings can be influenced by plenty of accounting adjustments, exclusions, depreciation policies, and other moving parts. Still, the price-to-earnings (P/E) ratio remains a useful yardstick for quickly assessing how much investors are paying for corporate profits.

Right now, the S&P 500 trades at roughly 25 times earnings. That's not necessarily outrageously expensive, but it's certainly not cheap either. Fortunately, getting broad exposure to the index remains inexpensive. The State Street SPDR Portfolio S&P 500 ETF (SPYM) charges just a 0.02% expense ratio. But according to Testfolio, SPYM had returned 12.34% cumulatively year to date through Sept. 1, while the State Street SPDR Portfolio S&P 500 High Dividend ETF (SPYD) returned 17.03%.

That dynamic fits with the broader resurgence in large-cap value stocks we've seen this year. SPYD is technically a high-dividend ETF, but its methodology also functions as a fairly straightforward value screen. Here's why I like this ETF as a contrarian pick.

Free Report, Just Released

The Top 10 Stocks To Buy Now

24/7 Wall St has helped investors make money for over two decades, and our top analysts just finished ranking the definitive Top 10 Stocks To Buy Now. Not the ten biggest companies. Not the ten everyone is arguing about. The ten best stocks to buy right now.

The report is free, and you can see why we think each stock is a top investment today.

Enter Your Email and See the Ten →

How SPYD Finds High-Yield Stocks

SPYD tracks the S&P 500 High Dividend Index, which starts with an already well-established universe: the S&P 500. That means its potential holdings have already passed the index's requirements surrounding market capitalization, liquidity, and positive earnings. From there, the methodology is remarkably simple. It identifies the 80 S&P 500 constituents with the highest dividend yields and builds its portfolio from those stocks, with quarterly rebalancing.

A high-dividend screen naturally captures some characteristics associated with value investing. Dividend yield is calculated by comparing a company's annual dividend with its share price. Assuming the dividend remains constant, a falling share price mechanically increases the yield.

That means high-yield screens frequently gravitate toward companies trading at depressed valuations. Some may simply be mature, cash-generating businesses that investors have overlooked. Others may be facing legitimate problems, which creates the classic risk of a dividend yield trap if earnings deteriorate and management eventually cuts the payout. SPYD accepts that risk rather than applying a complicated quality overlay. In exchange, investors get a very inexpensive portfolio. The ETF charges a 0.07% expense ratio and currently offers a 4.28% 30-day SEC yield.

One drawback is tax efficiency. Unlike some dividend ETFs, SPYD doesn't exclude real estate investment trusts (REITs). In fact, real estate is currently its largest sector allocation at 24.26%. REIT distributions frequently include income that doesn't qualify for the lower qualified-dividend tax rates, making SPYD potentially less tax efficient in a taxable brokerage account than dividend strategies that specifically exclude them.

How Much Value Exposure Does SPYD Provide?

The valuation difference between SPYD and the broader market is considerable. According to State Street, SPYD's portfolio currently trades at a P/E ratio of 17.06. Put simply, investors are paying an average of roughly $17.06 for every $1 of earnings generated by the companies in the portfolio. Compare that with approximately $25 for every $1 of earnings from the S&P 500. SPYD therefore provides exposure to large-cap U.S. stocks at a substantially lower earnings multiple while simultaneously producing a much higher dividend yield.

That valuation gap helps explain why SPYD has performed so well during this year's rotation toward value. Whether the outperformance continues will depend heavily on whether that rotation has further to run. Historically, SPYD has experienced long stretches of underperformance when growth stocks were leading the market, and a high yield alone doesn't guarantee superior total returns.

For investors looking to make a contrarian value bet, however, I think SPYD has a lot going for it. You're paying only 0.07% annually, getting a 4.28% SEC yield, and buying an S&P 500-derived portfolio at a much lower valuation than the broader index. There are also no derivative overlays, leverage, or complicated income gimmicks involved. SPYD simply owns 80 of the highest-yielding stocks in the S&P 500. If value stocks continue their winning streak, that's a straightforward way to participate.

Got $1,000? Read This Before You Buy Another Stock

If you have cash sitting in your account right now, give this two minutes. After more than two decades of helping investors beat the market, our top analysts at 24/7 Wall St. put together a definitive report on the Top 10 Stocks To Buy Today.

They combed the entire market. It's not 10 ideas, not 10 stocks everyone is talking about, it's what their research points to as the 10 best stocks to buy right now, and it's free. Read more here and see which stocks made the list -->>

Contact editorial@247wallst.com for any questions or corrections.