Saturday, May 1, 2010

Manulife Financial Corp 2

Today, I would like to continue to talk about Manulife Financial Corp (TSX-MFC, NYSE-MFC). I bought this stock in 2005 and 2006, with a bit more purchased in 2009. I have made a negative return, including dividends of -6.8%.

Looking at the Insider Buying and Insider Selling reports, it would appear that everyone, but the directors, have lots more options and shares. There has been a bit of insider buying and a bit more of insider selling for this stock. None of this amounts to much, but there was $.3M net selling over the past year, all by directors.

When I look at the P/E ratio, I find the 5 year average low to be 13 and the 5 year average high to be 20.6. The current P/E ratio that I have, based on earnings estimates for 2010 is 10.4. This is lower than the 5 year average low and it is a low P/E ratio. Looking at the Graham Price, I get one of $26.44 for 2010. This Graham Price is some 26% above the current stock price of $19.60. Both this factors show a current good stock price. Commenting on the Graham Price, this stock is not often at or below the Graham Price.

Moving on to the Price/Book Value Ratio, the current ratio of 1.19 is just 57% of the 5 year average of 2.09. This also shows a good current price. The last item to look at is the yield. The current yield is 2.7% compared to a 5 year average of 2.8%. Of course, the thing to note is that the dividend payments have recently been lowered almost 50%. So, all this seems to show a good current price.

When I look at what the analysts say, I find recommendations of Strong Buy, Buy and Hold. (See my site for information on analyst ratings.) Even the analysts with Hold ratings on this stock say that it has good long term potential. They just do not think that anything will happen in the short term. Some are also worried that the first quarterly earnings reporting that is due soon will not be great. The analysts with Buy and Strong Buy recommendations feel that this company will recover very nicely and produce a good long term return.

Since I buy for the long term, I will currently be holding on to what shares I own. I probably will not buy anymore as I feel I have enough of this stock already.

This is a life insurance company in the financial services business. It offers financial protection products (e.g. Life Insurance) and wealth management services (i.e. segregated funds, mutual funds and pension products). They sell products to individuals and business. They are an international company, selling in Canada, US and Asia. This company is listed on Canadian, US, Hong Kong and Philippines Stock Exchanges. 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 for stocks followed and investment notes. Follow me on twitter.

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