MFC gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 147 industry peers in the Insurance industry. MFC has only an average score on both its financial health and profitability. MFC has a decent growth rate and is not valued too expensively.

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

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.
MFC had a positive operating cash flow in each of the past 5 years.

1.2 Ratios

MFC has a Return On Assets of 0.53%. This is in the lower half of the industry: MFC underperforms 70.75% of its industry peers.
With a Return On Equity value of 10.48%, MFC perfoms like the industry average, outperforming 48.98% of the companies in the same industry.
MFC has a worse Return On Invested Capital (0.75%) than 63.95% of its industry peers.

		Industry Rank	Sector Rank
ROA	0.53%
ROE	10.48%
ROIC	0.75%

ROA(3y)0.27%

ROA(5y)0.44%

ROE(3y)5.1%

ROE(5y)7.68%

ROIC(3y)N/A

ROIC(5y)N/A

1.3 Margins

Looking at the Profit Margin, with a value of 13.87%, MFC is in the better half of the industry, outperforming 76.87% of the companies in the same industry.
MFC's Profit Margin has improved in the last couple of years.
Looking at the Operating Margin, with a value of 22.75%, MFC belongs to the top of the industry, outperforming 80.27% of the companies in the same industry.
In the last couple of years the Operating Margin of MFC has grown nicely.

		Industry Rank	Sector Rank
OM	22.75%
PM (TTM)	13.87%
GM	N/A

OM growth 3Y12.84%

OM growth 5Y19.32%

PM growth 3Y3.23%

PM growth 5Y14.2%

GM growth 3YN/A

GM growth 5YN/A

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so MFC is destroying value.
The number of shares outstanding for MFC has been reduced compared to 1 year ago.
MFC has less shares outstanding than it did 5 years ago.
The debt/assets ratio for MFC has been reduced compared to a year ago.

2.2 Solvency

MFC has a debt to FCF ratio of 0.44. This is a very positive value and a sign of high solvency as it would only need 0.44 years to pay back of all of its debts.
MFC's Debt to FCF ratio of 0.44 is amongst the best of the industry. MFC outperforms 82.99% of its industry peers.
A Debt/Equity ratio of 0.26 indicates that MFC is not too dependend on debt financing.
With a Debt to Equity ratio value of 0.26, MFC perfoms like the industry average, outperforming 59.86% of the companies in the same industry.

		Industry Rank	Sector Rank
Debt/Equity	0.26
Debt/FCF	0.44
Altman-Z	N/A

ROIC/WACC0.09

WACC8.36%

2.3 Liquidity

		Industry Rank	Sector Rank
Current Ratio	N/A
Quick Ratio	N/A

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

The Earnings Per Share has grown by an nice 9.55% over the past year.
MFC shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 5.49% yearly.
Looking at the last year, MFC shows a small growth in Revenue. The Revenue has grown by 7.70% in the last year.
MFC shows a very negative growth in Revenue. Measured over the last years, the Revenue has been decreasing by -13.62% yearly.

EPS 1Y (TTM)9.55%

EPS 3Y6.08%

EPS 5Y5.49%

EPS Q2Q%16%

Revenue 1Y (TTM)7.7%

Revenue growth 3Y-12.52%

Revenue growth 5Y-13.62%

Sales Q2Q%21.19%

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 5.15% on average per year.
MFC is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 11.90% yearly.

EPS Next Y8.17%

EPS Next 2Y8.45%

EPS Next 3Y8.81%

EPS Next 5Y5.15%

Revenue Next Year8.86%

Revenue Next 2Y8.68%

Revenue Next 3Y6.97%

Revenue Next 5Y11.9%

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 stable.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.

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4. Valuation

4.1 Price/Earnings Ratio

Based on the Price/Earnings ratio of 12.50, the valuation of MFC can be described as correct.
Compared to the rest of the industry, the Price/Earnings ratio of MFC is on the same level as its industry peers.
Compared to an average S&P500 Price/Earnings ratio of 28.32, MFC is valued rather cheaply.
A Price/Forward Earnings ratio of 11.29 indicates a reasonable valuation of MFC.
MFC's Price/Forward Earnings is on the same level as the industry average.
MFC's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 25.57.

		Industry Rank	Sector Rank
PE	12.5
Fwd PE	11.29

4.2 Price Multiples

Based on the Enterprise Value to EBITDA ratio, MFC is valued a bit cheaper than 62.59% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, MFC is valued cheaply inside the industry as 84.35% of the companies are valued more expensively.

		Industry Rank	Sector Rank
P/FCF	2.84
EV/EBITDA	7.5

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)1.53

PEG (5Y)2.28

EPS Next 2Y8.45%

EPS Next 3Y8.81%

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5. Dividend

5.1 Amount

With a Yearly Dividend Yield of 3.39%, MFC has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 2.19, MFC pays a better dividend. On top of this MFC pays more dividend than 80.95% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 1.83, MFC pays a better dividend.

		Industry Rank	Sector Rank
Dividend Yield	3.39%

5.2 History

On average, the dividend of MFC grows each year by 20.17%, which is quite nice.
MFC has paid a dividend for at least 10 years, which is a reliable track record.
MFC has not decreased its dividend in the last 3 years.

Dividend Growth(5Y)20.17%

Div Incr Years3

Div Non Decr Years3

5.3 Sustainability

MFC pays out 60.48% of its income as dividend. This is not a sustainable payout ratio.
MFC's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.

DP60.48%

EPS Next 2Y8.45%

EPS Next 3Y8.81%

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MANULIFE FINANCIAL CORP / MFC FAQ

What is the fundamental rating for MFC stock?

ChartMill assigns a fundamental rating of 4 / 10 to MFC.

Can you provide the valuation status for MANULIFE FINANCIAL CORP?

ChartMill assigns a valuation rating of 5 / 10 to MANULIFE FINANCIAL CORP (MFC). This can be considered as Fairly Valued.

How profitable is MANULIFE FINANCIAL CORP (MFC) stock?

MANULIFE FINANCIAL CORP (MFC) has a profitability rating of 4 / 10.

How financially healthy is MANULIFE FINANCIAL CORP?

The financial health rating of MANULIFE FINANCIAL CORP (MFC) is 4 / 10.

What is the earnings growth outlook for MANULIFE FINANCIAL CORP?

The Earnings per Share (EPS) of MANULIFE FINANCIAL CORP (MFC) is expected to grow by 8.17% in the next year.