Happy to hear your thoughts on SLF earnings miss. Also - any ideas why the US market is dropping so hard today? Is this just a matter of filling the recent run away gaps with profit taking, or something more worrisome and longer term?
Thanks!
D
EPS of $1.86 was in line with estimates. Sun Life's earnings outlook is healthy overall, though the Canadian life insurer faces pressure from weaker US underwriting and outflows at MFS that may cause a modest underlying EPS shortfall vs. its 10% annual growth target. Still, these headwinds could be largely offset by strong organic growth in Asia and at the SLC alternative-asset manager. In 3Q, SLC's inflows were $5 billion, representing 8% annualized growth, while individual sales in Asia surged 39%. The Canadian unit is also showing solid profit gains, buoyed by higher asset values, favorable underwriting and Sun Life's broad business profile. Earning in 3Q for the US business fell 34% and may remain at a lower level for a few quarters as disability, dental and stop-loss business is repriced to keep pace with higher claims costs. We think things remain OK at SLF overall.
The US is down on profit-taking, valuation concerns and 'AI bubble' talk. Q3 earnings though have been quite good, and we do not really expect the correction to be too serious.