This Free Cash Flow ETF is Quietly Outperforming Vanguard’s S&P 500 in 2026

It's quoted each the time, but I can't basal adjusted EBITDA: net earlier interest, taxes, depreciation, and amortization, with absorption often adding backmost an adjacent longer database of "one-time" expenses. The occupation is that companies person sizeable discretion implicit what gets excluded.

Stock-based compensation, restructuring charges, litigation costs, acquisition expenses, and different recurring items tin each beryllium labeled arsenic exceptional, making net look stronger than the underlying concern truly is. As the precocious Charlie Munger famously remarked, "Every clip you spot the connection EBITDA, you should substitute the connection 'bulls***' earnings." To beryllium fair, nary azygous metric is manipulation-proof, but escaped currency travel is overmuch harder to formal up than an adjusted net fig trailed by a leafage of add-backs.

I overmuch similar looking astatine escaped currency flow. Instead of focusing connected accounting profits, escaped currency travel starts with currency generated from operations, subtracts superior expenditures, and leaves you with what is yet disposable to wage dividends, repurchase shares, trim debt, oregon reinvest successful the business.

However, the S&P 500's escaped currency travel output has fallen beneath 2%, adjacent its lowest level successful decades. Part of that reflects the tremendous capex surrounding the AI buildout: respective of the Magnificent Seven hyperscalers are present spending hundreds of billions of dollars annually connected information centers, chips, networking equipment, and powerfulness infrastructure.

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One mode to perchance sidestep this is by focusing specifically connected companies that proceed generating abundant escaped currency travel — which is precisely what the VictoryShares Free Cash Flow ETF (VFLO) is built to do. According to testfolio.io, from Dec. 31, 2025 done July 1, 2026, VFLO delivered a 17.77% cumulative full return, beating the 9.97% instrumentality from the Vanguard S&P 500 ETF (VOO) implicit the aforesaid period.