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Sun Life Financial Inc. (SLF $88.99)
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Power Corporation of Canada Subordinate Voting Shares (POW $64.50)
Q: One of the factors I consider when comparing companies is Debt/Equity. 5i lists SLF as 7.16 and POW as 0.05. Could you please rationalize this difference for me.
Do you have a preference?
Do you have a preference?
5i Research Answer:
Our data provider may be off here or using some adjustments. POW is structured as a holding company and SLF is an operating company, and this is one difference. Also, financial companies tend to have a lot of debt, but these are generally liabilities and deposits from customers, and not corporate debt in the typical sense. Regardless, Bloomberg numbers show POW at 37 and SLF at 24. POW stock had a great run last year, but we prefer SLF today.