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MANULIFE FINANCIAL CORP (MFC.CA) Stock Fundamental Analysis

TSX:MFC - Toronto Stock Exchange - CA56501R1064 - Common Stock - Currency: CAD

43.06  +0.15 (+0.35%)

Fundamental Rating

5

We assign a fundamental rating of 5 out of 10 to MFC. MFC was compared to 84 industry peers in the Insurance industry. MFC has an average financial health and profitability rating. MFC has a correct valuation and a medium growth rate.


Dividend Valuation Growth Profitability Health

5

1. Profitability

1.1 Basic Checks

MFC had positive earnings in the past year.
In the past year MFC had a positive cash flow from operations.
MFC had positive earnings in 4 of the past 5 years.
In the past 5 years MFC always reported a positive cash flow from operatings.
MFC.CA Yearly Net Income VS EBIT VS OCF VS FCFMFC.CA Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 0 5B 10B 15B 20B

1.2 Ratios

MFC has a Return On Assets (0.54%) which is in line with its industry peers.
With a Return On Equity value of 10.18%, MFC is not doing good in the industry: 69.88% of the companies in the same industry are doing better.
MFC has a Return On Invested Capital (0.82%) which is in line with its industry peers.
Industry RankSector Rank
ROA 0.54%
ROE 10.18%
ROIC 0.82%
ROA(3y)0.35%
ROA(5y)0.47%
ROE(3y)5.84%
ROE(5y)7.94%
ROIC(3y)N/A
ROIC(5y)N/A
MFC.CA Yearly ROA, ROE, ROICMFC.CA Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2015 2016 2017 2018 2019 2020 2021 2022 2023 0 5 10

1.3 Margins

The Profit Margin of MFC (14.12%) is better than 80.72% of its industry peers.
In the last couple of years the Profit Margin of MFC has grown nicely.
Looking at the Operating Margin, with a value of 24.24%, MFC is in the better half of the industry, outperforming 79.52% of the companies in the same industry.
In the last couple of years the Operating Margin of MFC has grown nicely.
Industry RankSector Rank
OM 24.24%
PM (TTM) 14.12%
GM N/A
OM growth 3Y40.5%
OM growth 5Y5.56%
PM growth 3Y21.82%
PM growth 5Y2.88%
GM growth 3YN/A
GM growth 5YN/A
MFC.CA Yearly Profit, Operating, Gross MarginsMFC.CA Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2015 2016 2017 2018 2019 2020 2021 2022 2023 0 10 20

4

2. Health

2.1 Basic Checks

MFC has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
The number of shares outstanding for MFC has been reduced compared to 1 year ago.
The number of shares outstanding for MFC has been reduced compared to 5 years ago.
MFC has a better debt/assets ratio than last year.
MFC.CA Yearly Shares OutstandingMFC.CA Yearly Shares OutstandingYearly Shares Outstanding 2015 2016 2017 2018 2019 2020 2021 2022 2023 500M 1B 1.5B
MFC.CA Yearly Total Debt VS Total AssetsMFC.CA Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2015 2016 2017 2018 2019 2020 2021 2022 2023 200B 400B 600B 800B

2.2 Solvency

MFC has a debt to FCF ratio of 0.52. This is a very positive value and a sign of high solvency as it would only need 0.52 years to pay back of all of its debts.
MFC has a better Debt to FCF ratio (0.52) than 85.54% of its industry peers.
A Debt/Equity ratio of 0.26 indicates that MFC is not too dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.26, MFC is in the better half of the industry, outperforming 67.47% of the companies in the same industry.
Industry RankSector Rank
Debt/Equity 0.26
Debt/FCF 0.52
Altman-Z N/A
ROIC/WACC0.1
WACC8.22%
MFC.CA Yearly LT Debt VS Equity VS FCFMFC.CA Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 10B 20B 30B 40B 50B

2.3 Liquidity

Industry RankSector Rank
Current Ratio N/A
Quick Ratio N/A
MFC.CA Yearly Current Assets VS Current LiabilitesMFC.CA Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2015 2016 2017 2018 2019 2020 2021 2022 2023 5B 10B 15B 20B

5

3. Growth

3.1 Past

MFC shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 10.23%, which is quite good.
Measured over the past 5 years, MFC shows a small growth in Earnings Per Share. The EPS has been growing by 4.78% on average per year.
The Revenue has grown by 13.06% in the past year. This is quite good.
MFC shows a decrease in Revenue. Measured over the last years, the Revenue has been decreasing by -2.11% yearly.
EPS 1Y (TTM)10.23%
EPS 3Y7.83%
EPS 5Y4.78%
EPS Q2Q%8.7%
Revenue 1Y (TTM)13.06%
Revenue growth 3Y-22.48%
Revenue growth 5Y-2.11%
Sales Q2Q%77.9%

3.2 Future

Based on estimates for the next years, MFC will show a small growth in Earnings Per Share. The EPS will grow by 5.74% on average per year.
The Revenue is expected to grow by 15.13% on average over the next years. This is quite good.
EPS Next Y10.64%
EPS Next 2Y9.48%
EPS Next 3Y9.27%
EPS Next 5Y5.74%
Revenue Next Year-13.04%
Revenue Next 2Y-2.28%
Revenue Next 3Y-0.16%
Revenue Next 5Y15.13%

3.3 Evolution

When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
MFC.CA Yearly Revenue VS EstimatesMFC.CA Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 20B 40B 60B 80B
MFC.CA Yearly EPS VS EstimatesMFC.CA Yearly EPS VS EstimatesYearly EPS VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 1 2 3 4

4

4. Valuation

4.1 Price/Earnings Ratio

A Price/Earnings ratio of 11.42 indicates a reasonable valuation of MFC.
86.75% of the companies in the same industry are cheaper than MFC, based on the Price/Earnings ratio.
When comparing the Price/Earnings ratio of MFC to the average of the S&P500 Index (28.12), we can say MFC is valued rather cheaply.
The Price/Forward Earnings ratio is 10.38, which indicates a very decent valuation of MFC.
MFC's Price/Forward Earnings ratio is a bit more expensive when compared to the industry. MFC is more expensive than 63.86% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of MFC to the average of the S&P500 Index (94.77), we can say MFC is valued rather cheaply.
Industry RankSector Rank
PE 11.42
Fwd PE 10.38
MFC.CA Price Earnings VS Forward Price EarningsMFC.CA Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 20 40 60 80

4.2 Price Multiples

MFC's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. MFC is cheaper than 66.27% of the companies in the same industry.
MFC's Price/Free Cash Flow ratio is rather expensive when compared to the industry. MFC is more expensive than 83.13% of the companies in the same industry.
Industry RankSector Rank
P/FCF 2.95
EV/EBITDA 7
MFC.CA Per share dataMFC.CA EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 5 10 15 20 25

4.3 Compensation for Growth

The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
PEG (NY)1.07
PEG (5Y)2.39
EPS Next 2Y9.48%
EPS Next 3Y9.27%

5

5. Dividend

5.1 Amount

MFC has a Yearly Dividend Yield of 3.73%.
Compared to an average industry Dividend Yield of 4.31, MFC is paying slightly less dividend.
Compared to an average S&P500 Dividend Yield of 2.29, MFC pays a better dividend.
Industry RankSector Rank
Dividend Yield 3.73%

5.2 History

The dividend of MFC is nicely growing with an annual growth rate of 12.35%!
MFC has been paying a dividend for at least 10 years, so it has a reliable track record.
MFC has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)12.35%
Div Incr Years11
Div Non Decr Years14
MFC.CA Yearly Dividends per shareMFC.CA Yearly Dividends per shareYearly Dividends per share 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0.5 1 1.5

5.3 Sustainability

MFC pays out 61.19% of its income as dividend. This is not a sustainable payout ratio.
The dividend of MFC is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP61.19%
EPS Next 2Y9.48%
EPS Next 3Y9.27%
MFC.CA Yearly Income VS Free CF VS DividendMFC.CA Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2015 2016 2017 2018 2019 2020 2021 2022 2023 0 5B 10B 15B 20B
MFC.CA Dividend Payout.MFC.CA Dividend Payout, showing the Payout Ratio.MFC.CA Dividend Payout.PayoutRetained Earnings

MANULIFE FINANCIAL CORP

TSX:MFC (2/7/2025, 7:00:00 PM)

43.06

+0.15 (+0.35%)

Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupInsurance
GICS IndustryInsurance
Earnings (Last)11-06 2024-11-06/amc
Earnings (Next)02-19 2025-02-19/amc
Inst Owners60.28%
Inst Owner ChangeN/A
Ins Owners0.1%
Ins Owner ChangeN/A
Market Cap75.44B
Analysts76.67
Price Target48.2 (11.94%)
Short Float %N/A
Short RatioN/A
Dividend
Industry RankSector Rank
Dividend Yield 3.73%
Yearly Dividend1.62
Dividend Growth(5Y)12.35%
DP61.19%
Div Incr Years11
Div Non Decr Years14
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)4.2%
Min EPS beat(2)2.69%
Max EPS beat(2)5.71%
EPS beat(4)4
Avg EPS beat(4)4.37%
Min EPS beat(4)2.05%
Max EPS beat(4)7.05%
EPS beat(8)7
Avg EPS beat(8)4.84%
EPS beat(12)9
Avg EPS beat(12)2.62%
EPS beat(16)12
Avg EPS beat(16)2.46%
Revenue beat(2)2
Avg Revenue beat(2)571.51%
Min Revenue beat(2)528.61%
Max Revenue beat(2)614.4%
Revenue beat(4)N/A
Avg Revenue beat(4)N/A
Min Revenue beat(4)N/A
Max Revenue beat(4)N/A
Revenue beat(8)N/A
Avg Revenue beat(8)N/A
Revenue beat(12)N/A
Avg Revenue beat(12)N/A
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)1.85%
PT rev (3m)18.42%
EPS NQ rev (1m)0.55%
EPS NQ rev (3m)-0.08%
EPS NY rev (1m)0.11%
EPS NY rev (3m)1.94%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.67%
Valuation
Industry RankSector Rank
PE 11.42
Fwd PE 10.38
P/S 2.09
P/FCF 2.95
P/OCF 2.95
P/B 1.51
P/tB 1.92
EV/EBITDA 7
EPS(TTM)3.77
EY8.76%
EPS(NY)4.15
Fwd EY9.63%
FCF(TTM)14.58
FCFY33.85%
OCF(TTM)14.58
OCFY33.85%
SpS20.61
BVpS28.58
TBVpS22.46
PEG (NY)1.07
PEG (5Y)2.39
Profitability
Industry RankSector Rank
ROA 0.54%
ROE 10.18%
ROCE 0.94%
ROIC 0.82%
ROICexc 0.84%
ROICexgc 1.95%
OM 24.24%
PM (TTM) 14.12%
GM N/A
FCFM 70.72%
ROA(3y)0.35%
ROA(5y)0.47%
ROE(3y)5.84%
ROE(5y)7.94%
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexcg growth 3Y7.77%
ROICexcg growth 5Y-0.14%
ROICexc growth 3Y8.9%
ROICexc growth 5Y0.2%
OM growth 3Y40.5%
OM growth 5Y5.56%
PM growth 3Y21.82%
PM growth 5Y2.88%
GM growth 3YN/A
GM growth 5YN/A
F-Score7
Asset Turnover0.04
Health
Industry RankSector Rank
Debt/Equity 0.26
Debt/FCF 0.52
Debt/EBITDA 1.41
Cap/Depr N/A
Cap/Sales N/A
Interest Coverage 5.56
Cash Conversion 273%
Profit Quality 500.96%
Current Ratio N/A
Quick Ratio N/A
Altman-Z N/A
F-Score7
WACC8.22%
ROIC/WACC0.1
Cap/Depr(3y)N/A
Cap/Depr(5y)N/A
Cap/Sales(3y)N/A
Cap/Sales(5y)N/A
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)10.23%
EPS 3Y7.83%
EPS 5Y4.78%
EPS Q2Q%8.7%
EPS Next Y10.64%
EPS Next 2Y9.48%
EPS Next 3Y9.27%
EPS Next 5Y5.74%
Revenue 1Y (TTM)13.06%
Revenue growth 3Y-22.48%
Revenue growth 5Y-2.11%
Sales Q2Q%77.9%
Revenue Next Year-13.04%
Revenue Next 2Y-2.28%
Revenue Next 3Y-0.16%
Revenue Next 5Y15.13%
EBIT growth 1Y34.07%
EBIT growth 3Y8.91%
EBIT growth 5Y3.34%
EBIT Next Year-71.84%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y38.16%
FCF growth 3Y0.62%
FCF growth 5Y1.26%
OCF growth 1Y38.16%
OCF growth 3Y0.62%
OCF growth 5Y1.26%