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Manulife Financial Corporation (MFC)
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Sun Life Financial Inc. (SLF)
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Power Corporation of Canada Subordinate Voting Shares (POW)
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Definity Financial Corporation (DFY)
Q: What is your opinion on the insurance providers currently and future outlook? I had owned MFC a couple of years ago for a number of years where the money was essentially dead money the entire time. I was lucky enough to get out with a small profit back then and now I am looking to re-enter this space.
In the past few years with the lower bond yields I think this played a huge part in the performance of these companies but now with the rapid rise in yields will these have a breakout going forward? Is SLF still your favorite? As always thanks, your opinion is always appreciated
In the past few years with the lower bond yields I think this played a huge part in the performance of these companies but now with the rapid rise in yields will these have a breakout going forward? Is SLF still your favorite? As always thanks, your opinion is always appreciated
5i Research Answer:
We would still lean towards SLF for an overall quality company with secure dividends. The rise in interest rates has not helped the sector as much as expected, but the sector valuation still makes it quite attractive in our view. SLF is 10X earnings, MFC 7.5X. MFC has continued to underperform. DFY we think is quite interesting if one is looking for faster growth and a possible acquisition target.