Growth ETFs (exchange-traded funds) invest in companies that have a strong history of surpassing average revenue and earnings growth rates. These ETFs seek to capitalize on the long-term potential of high-growth businesses. Today, we have identified two growth ETFs – Vanguard Mega Cap Growth ETF (MGK) and iShares Morningstar Growth ETF (ILCG) – with a Strong Buy consensus rating and over 10% upside potential projected by analysts.
Let’s take a closer look at what Wall Street thinks about these two ETFs.
Morningstar Growth ETF (MGK)
The MGK ETF seeks to track the performance of the CRSP U.S. Mega Cap Growth Index, which is composed of the growth stocks of U.S. companies with a mega market cap. The ETF aims to hold each stock in nearly the same proportion as its weighting in the index.
MGK has $21.73 billion in assets under management (AUM), with its top 10 holdings contributing 62.94% of the portfolio. Importantly, it has a very low expense ratio of 0.07%. The MGK ETF has returned 10.35% in the past six months.
On TipRanks, the MGK ETF has a Strong Buy consensus rating. Of the 73 stocks held, 64 have Buys, and nine have a Hold rating. The analysts’ average price target on the MGK ETF of $361.86 implies a 15% upside potential from the current levels.
iShares Morningstar Growth ETF (ILCG)
The ILCG ETF seeks to track the performance of the U.S. Large-Mid Cap Broad Growth Index, which is composed of large and mid-cap U.S. equities. It provides exposure to stocks whose earnings are expected to grow at an above-average rate in comparison to the market.
ILCG has $2.23 billion in AUM, with its top 10 holdings contributing 53.21% of the portfolio. Also, it has a low expense ratio of 0.04%, making it a cost-effective option. Interestingly, ILCG has generated a return of 9.66% over the past six months.
On TipRanks, the ILCG ETF has a Strong Buy consensus rating. Of the 390 stocks held, 325 have Buys, 62 have a Hold, and three have a Sell rating. The analysts’ average price target of $93.94 implies a 14.75% upside potential from the current levels.
Concluding Thoughts
ETFs are a low-cost, diversified, and transparent way to participate in the market. These benefits, along with the over 10% upside potential expected by analysts in MGK and ILCG ETFs, make them worth considering by investors.
