Megaphone icon ETF Database is now VettaFi. Read More >
ETFdb Logo
ETFdb Logo
  • Channels
    • Active ETF
    • Alternatives
    • Beyond Basic Beta
    • China Insights
    • Climate Insights
    • Commodities
    • Core Strategies
    • Crypto
    • Disruptive Technology
    • Dividend
    • Dual Impact
    • Emerging Markets
    • Energy Infrastructure
    • Entrepreneur ETF
    • Equity ETF
    • ESG
    • ETF Building Blocks
    • ETF Education
    • ETF Strategist
    • Fixed Income
    • Future ETFs
    • Gold & Silver Investing
    • Innovative ETFs
    • Institutional Income Strategies
    • Leveraged & Inverse
    • Managed Futures
    • Modern Alpha
    • Multi-Asset
    • Multi-Factor
    • Nasdaq Investment Intelligence
    • Portfolio Strategies
    • Retirement Income
    • Smart Beta
    • Thematic Investing
    • Volatility Resource
  • Database
  • Tools
    • ETF Screener
    • ETF Country Exposure Tool
    • ETF Sector Tracker Tool
    • ETF Database Categories
    • Head-To-Head ETF Comparison Tool
    • ETF Stock Exposure Tool
    • ETF Issuer Fund Flows
    • Indexes
    • Mutual Fund To ETF Converter
    • ETF Data for Journalists
    • ETF Nerds
  • Research
    • First Bitcoin ETF
    • ETF Education
    • Equity Investing
    • Dividend ETFs
    • Leveraged ETFs
    • Inverse ETFs
    • Top ETF Sectors
    • Top ETF Issuers
    • Top ETF Industries
  • Webcasts
    • ETFs Future-Forward 2021: An iShares Investing Symposium
    • Three Themes for 2021: An iShares & MSCI Investing Symposium
  • Themes
    • AI ETFs
    • Blockchain ETFs
    • See all Thematic Investing ETF themes
    • ESG Investing
    • Marijuana ETFs
  • Videos & Podcasts
    • ETF 360 Video Series
    • ETF Trends on Videos
    • ETF Trends on Podcasts
    • ETF Prime Podcast
  • PRO
    • Pro Content
    • Pro Tools
    • Advanced
    • FAQ
    • Pricing
    • Free Sign Up
    • Login
  1. Emerging Markets Channel
  2. Shareholder Rewards Might Lift Some EMQQ Components
Emerging Markets Channel
Share

Shareholder Rewards Might Lift Some EMQQ Components

Tom LydonApr 25, 2022
2022-04-25

Emerging markets internet stocks, like their U.S. counterparts, usually aren’t known for dividends, but there are examples of some companies delivering cash to shareholders.

While the practice isn’t yet widespread, it could be beneficial, even in incremental terms, to exchange traded funds such as the Emerging Markets Internet & Ecommerce ETF (EMQQ B-).

One example is Chinese online retail giant JD.com (NASDAQ:JD). That company is considering a special dividend that could be paid next month. Unexpected dividends are always a treat for investors, but in the case of JD.com, it’s potentially impactful because EMQQ’s sixth-largest holding is heavily shorted, meaning that short sellers are on the hook for the dividend. Plus, JD.com has $2.2 billion remaining on a $3 billion share buyback plan that was announced last December.

“Since buybacks are usually subject to trading window restrictions and may not see immediate effect, we believe the decision for a special cash dividend likely suggests JD’s management and board are evaluating different ways to return value to shareholders, especially given the current uncertain macro environment,” says Citigroup analyst Alicia Yap.

Speaking of buybacks, Alibaba (NYSE:BABA), the largest e-commerce company in China, said last month that it’s expanding its share repurchase program to $25 billion.

“The upsized share buyback underscores our confidence in Alibaba’s long-term, sustainable growth potential and value creation," deputy chief financial officer Toby Xu said. "Alibaba’s stock price does not fairly reflect the company’s value given our robust financial health and expansion plans.”

Alibaba is EMQQ’s third-largest holding at a weight of 8.54%. Shares of Alibaba are off nearly 63% over the past year, indicating that the company is doing something other firms rarely do: repurchase their own shares at a discount.

“The company has been under pressure since late 2020 when its billionaire founder, Jack Ma, publicly criticised China’s regulatory system,” reports Reuters. “Authorities subsequently halted the planned blockbuster IPO of its financial arm Ant Group and slapped Alibaba with a record $2.8 billion fine for anti-competitive behaviour, triggering a long slide in its shares.”

At the end of last year, Alibaba had more than $70 billion in cash on hand, and its cash balance has jumped more than tenfold since 2013, indicating that it has ample resources with which to dramatically reduce its shares outstanding count.

For more news, information, and strategy, visit our Emerging Markets Channel.

Loading Articles...
Help & Info
  • Contact Us
  • Mission Statement
  • Press
Tools
  • ETF Screener
  • ETF Analyzer
  • Mutual Fund to ETF Converter
  • Head-To-Head ETF Comparison
  • ETF Country Exposure Tool
  • ETF Stock Exposure Tool
  • ETF Performance Visualizer
  • ETF Database Model Portfolios
  • ETF Database Realtime Ratings
  • ETF Database Pro
More Tools
  • ETF Launch Center
  • Financial Advisor & RIA Center
  • ETF Database RSS Feed
Explore ETFs
  • ETF News
  • ETF Picks of the Month
  • ETF Category Reports
  • Premium Articles
  • Alphabetical Listing of ETFs
  • Best ETFs
  • Browse ETFs by ETF Database Category
  • Browse ETFs by Index
  • Browse ETFs by Issuer
  • Compare ETFs
Legal
  • Terms of Use and Privacy Policy
  • © ETF Flows LLC
Follow ETF Database
Follow ETF Database

Advertisement

Is Your Portfolio Positioned With Enough Global Exposure?

Equity ETF Channel

Retirement Portfolio Redux: Is the 60%-40% Portfolio Dead?

Debbie CarlsonOct 22, 2020
2020-10-22

With the 10-year U.S. Treasury yield hovering below 1% and Federal Reserve Chairman Jerome Powell...

Equity ETF Channel

Portfolio Diversification Isn't Dead, It Was Just Sleeping

Debbie CarlsonOct 15, 2020
2020-10-15

Investors could be forgiven to think there was no reason to invest outside of the U.S. for the...

}
X