MANULIFE FINANCIAL CORP (MFC) Stock Fundamental Analysis
NYSE:MFC - New York Stock Exchange, Inc. - CA56501R1064 - Common Stock - Currency: USD
We assign a fundamental rating of 5 out of 10 to MFC. MFC was compared to 143 industry peers in the Insurance industry. Both the profitability and the financial health of MFC get a neutral evaluation. Nothing too spectacular is happening here. MFC is not valued too expensively and it also shows a decent growth rate. Finally MFC also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
In the past year MFC was profitable.
In the past year MFC had a positive cash flow from operations.
MFC had positive earnings in 4 of the past 5 years.
Each year in the past 5 years MFC had a positive operating cash flow.
1.2 Ratios
The Return On Assets of MFC (0.52%) is worse than 72.73% of its industry peers.
MFC has a Return On Equity of 9.84%. This is comparable to the rest of the industry: MFC outperforms 51.75% of its industry peers.
MFC has a worse Return On Invested Capital (0.78%) than 62.24% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.52% | ||
| ROE | 9.84% | ||
| ROIC | 0.78% |
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
With a decent Profit Margin value of 13.55%, MFC is doing good in the industry, outperforming 74.83% 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 23.43%, MFC belongs to the top of the industry, outperforming 83.22% of the companies in the same industry.
MFC's Operating Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 23.43% | ||
| PM (TTM) | 13.55% | ||
| 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
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.
Compared to 5 years ago, MFC has less shares outstanding
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 0.53. This is a very positive value and a sign of high solvency as it would only need 0.53 years to pay back of all of its debts.
The Debt to FCF ratio of MFC (0.53) is better than 76.92% of its industry peers.
MFC has a Debt/Equity ratio of 0.27. This is a healthy value indicating a solid balance between debt and equity.
MFC's Debt to Equity ratio of 0.27 is fine compared to the rest of the industry. MFC outperforms 62.24% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.27 | ||
| Debt/FCF | 0.53 | ||
| Altman-Z | N/A |
ROIC/WACC0.1
WACC8%
2.3 Liquidity
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | N/A | ||
| Quick Ratio | N/A |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 12.14% over the past year.
Measured over the past 5 years, MFC shows a small growth in Earnings Per Share. The EPS has been growing by 5.49% on average per year.
The Revenue has grown by 11.76% in the past year. This is quite good.
Measured over the past years, MFC shows a very negative growth in Revenue. The Revenue has been decreasing by -13.62% on average per year.
EPS 1Y (TTM)12.14%
EPS 3Y6.08%
EPS 5Y5.49%
EPS Q2Q%11.96%
Revenue 1Y (TTM)11.76%
Revenue growth 3Y-12.52%
Revenue growth 5Y-13.62%
Sales Q2Q%48.7%
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 5.14% on average per year.
MFC is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 18.62% yearly.
EPS Next Y7.65%
EPS Next 2Y8.57%
EPS Next 3Y6.76%
EPS Next 5Y5.14%
Revenue Next Year9.3%
Revenue Next 2Y7.46%
Revenue Next 3Y6.55%
Revenue Next 5Y18.62%
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.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 11.14, which indicates a very decent valuation of MFC.
Based on the Price/Earnings ratio, MFC is valued a bit cheaper than the industry average as 61.54% of the companies are valued more expensively.
When comparing the Price/Earnings ratio of MFC to the average of the S&P500 Index (28.10), we can say MFC is valued rather cheaply.
With a Price/Forward Earnings ratio of 10.36, the valuation of MFC can be described as very reasonable.
MFC's Price/Forward Earnings ratio is in line with the industry average.
When comparing the Price/Forward Earnings ratio of MFC to the average of the S&P500 Index (20.74), we can say MFC is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.14 | ||
| Fwd PE | 10.36 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of MFC indicates a somewhat cheap valuation: MFC is cheaper than 70.63% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, MFC is valued cheaply inside the industry as 83.92% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 2.81 | ||
| EV/EBITDA | 6.57 |
4.3 Compensation for Growth
MFC's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
PEG (NY)1.46
PEG (5Y)2.03
EPS Next 2Y8.57%
EPS Next 3Y6.76%
5. Dividend
5.1 Amount
MFC has a Yearly Dividend Yield of 4.12%, which is a nice return.
Compared to an average industry Dividend Yield of 3.24, MFC pays a better dividend. On top of this MFC pays more dividend than 81.82% of the companies listed in the same industry.
MFC's Dividend Yield is rather good when compared to the S&P500 average which is at 2.43.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.12% |
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
62.26% of the earnings are spent on dividend by MFC. This is not a sustainable payout ratio.
MFC's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP62.26%
EPS Next 2Y8.57%
EPS Next 3Y6.76%
31.31
-0.26 (-0.82%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupInsurance
GICS IndustryInsurance
Earnings (Last)
Earnings (Next)
Inst Owners56.7%
Inst Owner Change-0.43%
Ins Owners0.04%
Ins Owner ChangeN/A
Market Cap53.80B
Analysts76.67
Price Target36 (14.98%)
Short Float %0.33%
Short Ratio2.15
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.12% |
Yearly Dividend1.29
Dividend Growth(5Y)20.17%
DP62.26%
Div Incr Years3
Div Non Decr Years3
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)6.79%
Min EPS beat(2)5.71%
Max EPS beat(2)7.87%
EPS beat(4)4
Avg EPS beat(4)4.58%
Min EPS beat(4)2.05%
Max EPS beat(4)7.87%
EPS beat(8)7
Avg EPS beat(8)4.83%
EPS beat(12)9
Avg EPS beat(12)3.14%
EPS beat(16)12
Avg EPS beat(16)2.81%
Revenue beat(2)2
Avg Revenue beat(2)571.15%
Min Revenue beat(2)527.89%
Max Revenue beat(2)614.4%
Revenue beat(4)4
Avg Revenue beat(4)552.78%
Min Revenue beat(4)527.89%
Max Revenue beat(4)614.4%
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)0.46%
PT rev (3m)7.32%
EPS NQ rev (1m)-1.62%
EPS NQ rev (3m)-0.13%
EPS NY rev (1m)-0.98%
EPS NY rev (3m)0.72%
Revenue NQ rev (1m)N/A
Revenue NQ rev (3m)N/A
Revenue NY rev (1m)-4.68%
Revenue NY rev (3m)-0.09%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.14 | ||
| Fwd PE | 10.36 | ||
| P/S | 1.99 | ||
| P/FCF | 2.81 | ||
| P/OCF | 2.81 | ||
| P/B | 1.44 | ||
| P/tB | 1.84 | ||
| EV/EBITDA | 6.57 |
EPS(TTM)2.81
EY8.97%
EPS(NY)3.02
Fwd EY9.65%
FCF(TTM)11.16
FCFY35.64%
OCF(TTM)11.16
OCFY35.64%
SpS15.77
BVpS21.7
TBVpS17.05
PEG (NY)1.46
PEG (5Y)2.03
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.52% | ||
| ROE | 9.84% | ||
| ROCE | 0.92% | ||
| ROIC | 0.78% | ||
| ROICexc | 0.8% | ||
| ROICexgc | 1.86% | ||
| OM | 23.43% | ||
| PM (TTM) | 13.55% | ||
| GM | N/A | ||
| FCFM | 70.77% |
ROA(3y)0.27%
ROA(5y)0.44%
ROE(3y)5.1%
ROE(5y)7.68%
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 3Y-2.15%
ROICexcg growth 5Y-0.07%
ROICexc growth 3Y-3.34%
ROICexc growth 5Y-0.84%
OM growth 3Y12.84%
OM growth 5Y19.32%
PM growth 3Y3.23%
PM growth 5Y14.2%
GM growth 3YN/A
GM growth 5YN/A
F-Score5
Asset Turnover0.04
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.27 | ||
| Debt/FCF | 0.53 | ||
| Debt/EBITDA | 1.47 | ||
| Cap/Depr | N/A | ||
| Cap/Sales | N/A | ||
| Interest Coverage | 5.57 | ||
| Cash Conversion | 274.83% | ||
| Profit Quality | 522.15% | ||
| Current Ratio | N/A | ||
| Quick Ratio | N/A | ||
| Altman-Z | N/A |
F-Score5
WACC8%
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)12.14%
EPS 3Y6.08%
EPS 5Y5.49%
EPS Q2Q%11.96%
EPS Next Y7.65%
EPS Next 2Y8.57%
EPS Next 3Y6.76%
EPS Next 5Y5.14%
Revenue 1Y (TTM)11.76%
Revenue growth 3Y-12.52%
Revenue growth 5Y-13.62%
Sales Q2Q%48.7%
Revenue Next Year9.3%
Revenue Next 2Y7.46%
Revenue Next 3Y6.55%
Revenue Next 5Y18.62%
EBIT growth 1Y9.56%
EBIT growth 3Y-1.3%
EBIT growth 5Y3.07%
EBIT Next Year-69.45%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y29.73%
FCF growth 3Y4.59%
FCF growth 5Y5.22%
OCF growth 1Y29.73%
OCF growth 3Y4.59%
OCF growth 5Y5.22%