Wednesday, August 26, 2009

Power Financial Corp

I am reviewing this stock (TSX-PWF) today as I have not yet reviewed it and the 2008 year end annual statement has came in. I own this stock. I first bought this stock in December of 2001 and I purchased some more in August of 2004. I have earned 9% return per year on this stock, including dividends.

If you look at the growth figures for this stock, they are good except for earnings and stock price. The earnings dipped in the last bear market and they have done the same in this one. The stock price growth has not been as good in the last 10 year and 5 year periods as it was prior to this. However, revenues, book value and cash flow growth as been good. Personally, I like this stock better than Power Corp, but then I do tend to be partial to financial stock.

As with most financial stock, there is no reporting on current assets and current liability, so there is no liquidity ratio on this stock. The Asset/Liability ratio has a long term average of 1.17. At the end of 2008 and for the quarter ending at June 2009, this ratio is 1.18. This is a typical ratio for a financial stock.

All in all, I am pleased with this stock and I will continue to hold my shares. I expect that this stock will do well for me in the long term.

Controlling shareholder of Power Corp of Canada is Paul Demarais. They have 30.1%, but they have 64.6% voting control. This company is a holding and management company. Its operations provide a range of individual and corporate financial and fiduciary services in North America and Europe. Subsidiaries of Power Financial include Great-West Lifeco, IGM Financial, London Insurance Group, Canada Life Financial, Putnam Invest., LLC Investors Group, Mackenzie Financial Corporation, and its affiliate Pargesa Holding SA. The Pargesa Group holds significant positions in five large companies based in Europe of Total (energy), Suez (energy, water, and waste services), Imerys (specialty minerals), Lafarge (cement and building materials and Pernod Ricard (Wines and Spirits). Its web site is . See my spreadsheet at

This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website at for a list of the stocks for which I have put up spreadsheets.

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