Market volatility continues ahead of the summer months on fomenting investor concerns regarding tariff impacts and slowing U.S. growth. Income investors seeking the potential stability of dividend stocks would do well to consider the actively managed T. Rowe Price Dividend Growth ETF (TDVG ).
Earnings season is underway, with investors paying close attention to forward-looking guidance from companies and tariff-impact projections. Amazon cited tariff and recession fears for curtailed guidance for this quarter, while Apple estimates it will take nearly a $1 billion hit from tariff costs this quarter, reported CNBC.
U.S. GDP contracted in the first quarter, largely driven by an import surge as companies rushed to try to front run tariffs. However, signs of weakening from consumers and sharp gains in the personal consumption expenditures price index (PCE) paint a darkening picture. PCE rose 3.6% in Q1, with core PCE (which excludes energy and food) gaining 3.5%. PCE is one of the Fed’s preferred inflation gauges.
On the labor side, more jobs were added in April (177,000) than expected, while unemployment remained steady at 4.2%, reported the WSJ. Tariff impacts could put ratcheting pressure on businesses looking ahead, however, causing a slowdown in hiring and spending by companies. It creates a complex and uncertain picture for the economy looking ahead, with volatility threaded throughout every narrative.
Seek Reliable Income With Dividend Stocks and TDVG
When uncertainty rises, dividend companies become a popular choice with investors. These companies may not offer elevated growth like some of their high-octane peers, but they generally provide stability. In times of market duress, reliable income becomes a boon.
The T. Rowe Price Dividend Growth ETF (TDVG ) seeks long-term capital growth and dividend income. The actively managed strategy invests in large-cap dividend-paying companies, or those expected to begin paying dividends. The companies invested in are expected to demonstrate elevated dividend and earnings growth.
The management team seeks to maximize return potential by investing in dividend-paying companies when they are undervalued in markets. When selecting stocks for inclusion, the strategy considers a company’s cash flow, balance sheet strength, and dividend yields that are competitive to peers. It also seeks those companies with competitive advantages within their industry.
The fund is up 1.92% YTD on a price returns basis according to Y-charts data. TDVG also currently trades in buy territory, above both its 50- and 200-day simple moving averages. It makes the fund a strategy worth consideration in the challenging market environment of 2025. TDVG carries an expense ratio of 0.50%.
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