Cambria Fund Profile: Shareholder Yield Suite

0:00Welcome to the Metfavor Show, where the focus is on helping you grow and preserve your wealth. Join us as we discuss the craft of investing and uncover new and profitable ideas, all to help you grow wealthier and wiser. Better investing starts here. Metfavor is the co-founder and chief investment officer at Cambria Investment Management. For more information, visit Cambriainvestments.com. Howdy friends! Today's a special episode. I'm going to talk about one of my oldest and favorite approaches to the market. Shareholder yield. And the Cambria funds we engineered around it. Let's jump right in. Let me start with a simple question. What do you get when you own a stock? The component most investors look to first as the dividend, and fair enough, reinvested dividends have historically made up roughly half of US stocks long-term returns. Going all the way back to the 1870s, but the dividend is only one piece of total return. As I record this, the S&P 500's dividend yield is sitting around 1% the lowest reading

1:05for US stocks in history. You might treat that as a sign, stocks are handing investors less than ever, but that number only counts dividends. Stopping there is like the old parable of the blind man in the elephant. Each one grabs a different part and misses the whole animal. Now, there's a structural reason behind why that matters more today than it used to. Companies now pay out a smaller share of earnings as cash dividends than they once did. Around 40% down from roughly 60% a century ago. Something that accelerated this was the SEC's rule, 10B18 in 1982, which gave firms that save a harbor from manipulation charges when repurchasing their own shares. Some share repurchases or buybacks got easier. They climbed from almost nothing to equaling their surpassing dividends by the late 1990s. And here's the key piece of data. The total cash companies returned as the share of profits has stayed relatively steady. It's the mix that shifted. And the scale today is enormous.

2:05According to S&P Global, for S&P 500 companies, buybacks crossed a trillion over the 12 months through September 25, paired with about 660 billion in dividends. Roughly 60 cents of every dollar return to shareholders was through buybacks. So focusing on dividends alone means you missed most of the story. Capturing the entire picture is the idea behind shareholder yield. Instead of asking how much a company pays in dividends, ask how much it returns the shareholders overall. Dividends in buybacks combined. It's a more complete answer to a simple question, how much cash is the company actually returning to me? For anyone less familiar, share repurchase or buyback returns profits much like a dividend. But for a taxable investor, it doesn't trigger the same taxable event. The value is just subtler, reflected in the share price rather than landing in your brokerage account. At the end of the day, wouldn't you rather have the highest total return? Whatever form it takes. The holistic view of shareholder yield offers a valuable shift in perspective.

3:07Picture two companies paying the exact same dividend and traded the exact same price. One is also steadily buying back its shares and the other isn't. The one buying back shares is actually returning more cash to shareholders despite both companies offering identical dividend yields. That's the blind spot. Buybacks are a real slice of total return and shareholder yield is simply the lens that lets you see the whole rather than a single piece. There's one catch though and it's about price. Warren Buffett said it best in his 1984 letter to Berkshire Hathaway shareholders. Quote, when companies with outstanding businesses and comfortable financial positions find their shares selling far below intrinsic value in the marketplace, no alternative action can benefit shareholders as surely as repurchases. The key phrase for buybacks here is intrinsic value. If you're an overconfident CEO buying back overvalued shares, then you're destroying value. In such a case, an objection to include buybacks would be valid. Buybacks would indeed be a detriment to total return in that case.

4:08But when a Y CEO buys back shares, a great valuations that are below intrinsic value to paraphrase Buffett's quotes, no alternative action benefits shareholder, surely as repurchases. The objective isn't simply to find companies returning a lot of cash. It's finding the ones doing that while also trading it reasonable or downright cheap valuations. Ideally, with quality balance sheets, so they can return cash sustainably. Here at Cambria, we put that process to work across five ETFs spanning US, foreign developed, and emerging market stocks, while each addresses the different slice in the market they're engineered the same way. So let's walk through a summary of how the process works in practice. Instead of chasing flashy, high-flying stocks or trending stories, we approach it systematically. We tune out the noise and translate research into a sound repeatable process. Think of it as a funnel, taking a wide universe of stocks and walking through a series of defined steps until we're left with the highest ranking group of stocks according to our

5:08preset rules. From our starting universe, we consider securities ranked highly by yield across dividends and net buybacks. Then we assess valuation, as well as quality and leverage metrics. We narrow further by isolating the top shareholder yield stocks with high debt retirement and finishing with a momentum sort to try and sidestepped the classic value trap. And stock that's cheap and keeps getting cheaper. Result is a portfolio of roughly 50 or 100 stocks depending on the specific fund, diversified across sectors, roughly equated and rebounds quarterly. It's an exhausting process, but we believe it's worth it. This discipline shows up in the numbers because valuation is a core component of the strategy. Our ETFs tend to offer deeper value exposure than their peers. Take our flagship, the Cambria shareholder yield ETF, ticker symbol, sYLD, which invests in US stocks. As the end of August 2026, SYLD's portfolio traded at a price earnings ratio of about 13.7 versus 18.1 for the Morningstar Midcap value category.

6:09And it's not just that one metric. It gets traded below the category average on price to book, price to sales, price to cash low to. That's the value till it work. Shareholder yield isn't just a US concept either. It exists around the world. We run the same playbook across reasoned. SYLD for US stocks, the Cambria foreign shareholder yield ETF with the ticker symbol, sYLD for foreign developed stocks, and the Cambria emerging shareholder yield ETF with the symbol, eWYLD for emerging market stocks. In every case, the portfolio trading and meaningful discount to the Morningstar category across the ensemble of valuation metrics we track. Same idea, three distinct regions of the world. The natural question though is, does it actually work in live trading over time? This year gave us a good checkpoint. eWYLD just became our third shareholder yield ETF to cross a 10 year track record joining both SYLD and FYLD. Measured against the Morningstar categories as of the end of August 2026 with the first percentile being the top here.

7:10SYLD ranked in the fifth percentile of the Morningstar Midcap value category. FYLD ranked in the 13th percentile of the Morningstar foreign small mid-value category. The eWYLD and the third percentile of the Morningstar diversified emerging markets category for 10 year total return. Three funds with returns drive from various regions around the world, US foreign developed emerging all ranked near the top of their respective categories over the previous decade period. We believe any sound investment approach should prove itself in many places, not just one. And we don't expect this kind of outperformance all the time either. In fact a strong decade of performance doesn't mean a smooth ride. SYLD lagged its Morningstar category in both 2024 and 2025. It's first back-to-back years training. It's category since inception in 2013. That's uncomfortable, but it's entirely normal. Even sound strategy has been stretches out of favor. That's why we lean on systematic rules-based processes designed to stay the course through it all.

8:10Following the same rules and phase, whatever the market happens to be doing at the time. As we wrap up SYLD, FYLD, EYLD, apply the shareholder yield discipline to US foreign developed emerging. SYLD can span the market cap spectrum. It's cap agnostic. More recently we extended the discipline into two more corners of the US market. The Cambria large cap, shareholder yield ETF, ticker symbol LYLD, and the Cambria micro and small cap shareholder yield ETF, ticker symbol MYLD. An investor can approach the full cap range in one fund with SYLD or target the larger and smaller ends directly with LYLD and MYLD. Putting it all together, the suite now covers a range of market capitalizations in US stocks plus foreign developed and emerging, all built on one durable idea. Follow the cash flow by emphasizing companies returning cash to shareholders through dividends and buybacks. That's the suite, one idea, ready for you to put to work wherever you want with your equity exposure. So no matter what the market is doing today, shareholder yield offers a way to think holistically about income and total return and about what you might be missing when you think about

9:12dividends alone. If you want to learn more, visit CambriaFunds.com or call us at 310-683-5500. Thanks for listening friends and good investing. Disclosure. Here are some required standardized performance for your reference. All returns are average annual total returns as of June 30th, 2026. The gross and net expense ratio is 0.59% for SYLD. As of June 30th, 2026 over the past year, SYLD's net asset value and its market price return 23.88% and 24.07% respectively, while the S&P 500 index return 22.32%. Over the three year period, SYLD's net asset value and market price return 11.20 and 11.19% while the S&P 500 index return 20.61%. Over the five year period, SYLD returns 6.73% on both the net asset value and market price basis while the S&P 500 index return 13.41%. Over the 10 year period, SYLD's net asset value and market price return 13.26% and 13.27% while the S&P 500 index return 15.51%. Since the funds inception on May 14, 2013, SYLD's net asset value and market price each returned 12.12% while the S&P 500 index return 14.33%.

10:16Short-term performance may not be indicative of long-term performance. Actual results may vary. Pass performance does not guarantee future results. The investment return and principal value of an investment will fluctuate so that an investor shares, when redeemed, may be worth more or less than their original costs and current performance may be lower or higher than the performance quoted. For performance data current to the most recent month end, please call 855-383-4636 or ETF info or visit CambriaFunds.com. The closing market price is the midpoint between the bid and ask price as of the close of the exchange. Since the funds shares typically do not trade in the secondary market until several days after the funds inception. For the period from the inception to the first day of secondary market trading shares, the NAV of the fund is used to calculate total market returns. Shares are bought and sold at market closing price, not net asset value or NAV, and are not individually redeemed from the fund. Market price returns are based on the midpoint of the bid as spread at 4pm Eastern when Nav is normally redeemed and do not represent the return you would receive if you traded it at other times. Buying and selling shares will result in brokerage commissions. To determine if this fund is an appropriate investment for you, carefully consider the funds investment objectives, risk factors, charges, and expenses before investing. This another information can be found in the funds' perspectives, which may be obtained by calling 855-383-4636, also known as ETF info, or visiting our website at CambriaFunds.com.

11:16Read the perspectives carefully before investing or sending money. The Cambria ETFs are distributed by Alps Distributors Inc. 1290 Broadway, Sweet 1000 Denver, Colorado, 80203, which is not affiliated with Cambria Investment Management LP, the Investment Advisor for the Fund. Morningstar ranking slash number of funds in the category displays the funds actual rank within its Morningstar category based on the average annual total return and the number of funds in that category. The return assumes reinvestment of dividends and does not reflect any applicable sales charge. Morningstar percentage rankings are the funds total return rank relative to all funds in the same Morningstar category, where one is the highest or best percentile in 100 is the lowest. As of August 31st, 2026, over the trailing 10-year period, S.Y.L.D. is ranked in the top 5% of Morningstar midcap value category based on 337 funds. F.Y.L.D. is ranked in the top 13% of Morningstar, 4 and small slash mid-value category based on 40 funds, and E.Y.L.D. is ranked in the top 3% of the Morningstar diversified emerging markets category based on 540 funds. A few definitions. The S&P 500 index. An index of 500 US stocks chosen from market size, liquidity and industry grouping among other factors. The S&P 500 is designed to be a leading indicator of US equities and is meant to reflect the risk, slash return characteristics of the large cap universe. Indexes are unmanage, do not reflect the deduction of fees or expenses and are available for direct investment.

12:16Shareholder yield generally defined as the equity securities total yield from the combination of dividend yield and buyback yield. Tividend, a payment from a corporation to a shareholder, buyback or repurchase, the process of a corporation buying back shares of its stock.