Is it a good company at a reasonable price? I think you can do well to invest in Insurance Companies; however, it would seem that this company’s stock has gone up a lot lately and is at an all-time high. I would be cautious about investing in a company at an all-time high. My testing is showing that the stock price is relatively expensive.
I do not own this stock of Great-West Lifeco Inc (TSX-GWO, OTC-GWLIF). This stock seems to be a favorite with investors who like solid, stable, dividend paying stock. It was on Mike Higgs' list and it used to be on the dividend lists. I have been following this stock for some time. However, I will not buy it because I have Power Corp. (TSX-POW). Great West Lifeco Inc. is one of the companies under Power Corp. (TSX-POW).
When I was updating my spreadsheet, I noticed that in 2025 the company purchased (Buy-back) 3% of the outstanding shares. In the first 6 months of this year, the company purchased 1.5% of the outstanding shares. I noticed that the Desmarais Family Residuary Trust shares went down 3.5% between September 12, 2025 and September 11, 2026. The shares in this trust were flat for many years, but last year they sold some shares also.
If you had invested in this company in December 2015, for $1,101.37 you would have bought 29 shares at $34.53 per share. In December 2025, after 10 years you would have received $531.16 in dividends. The stock would be worth $1,963.01. Your total return would have been $2,494.17. This would be a total return of 10.83% per year with 6.96% from capital gain and 3.87% from dividends.
| Cost | Tot. Cost | Shares | Years | Dividends | Stock Val | Tot Ret |
|---|---|---|---|---|---|---|
| $34.53 | $1,001.37 | 29 | 10 | $531.16 | $1,963.01 | $2,494.17 |
The current dividend yield is moderate with dividend growth low. The current dividend yield is moderate (2% to 4% ranges) at 2.88%. The 5 and 10 year median dividend yields are good (5% to 6% ranges) at 5.24% and 5.16%. The historical dividend yield is moderate at 3.86%. The dividend growth is low (below 8% per year) at 6.9% per year over the past 5 years. The last dividend increase was in 2026 and it was for 9.8%.
The Dividend Payout Ratios (DPR) are generally fine. The DPR for 2025 for Earnings per Share (EPS) is high at 57% with 5 year coverage at 58%. The DPR for 2025 for Adjusted Earnings per Share (AEPS) is good at 49% with 5 year coverage high at 52%. The DPR for 2025 for Cash Flow per Share (CFPS) is high at 82% with 5 year coverage good at 32%. The DPR for 2025 for Free Cash Flow (FCF) is high at 83% with 5 year coverage good at 36%. FCF varies for 2025 from a negative $5,040M to $2,708M and I am using the $2,708M.
The EPS DPR for 2026 is expected to be in the 50% range, but declining into the 40% range in 2027.
| Item | Cur | 5 Years |
|---|---|---|
| EPS | 57.28% | 57.68% |
| AEPS | 48.70% | 51.90% |
| CFPS | 81.66% | 32.45% |
| FCF | 83.20% | 36.42% |
Debt Ratios are fine. The Long Term Debt/Market Cap Ratio for 2025 is at 4.10 and currently at 3.11. However, we need also to look at the Long Term Debt/Covering Assets Ratio for 2025 which is fine at 0.94 and currently at 0.93 because this is a more important ratio for a Financial. The Liquidity Ratio for 2025 is low at 1.03 and 1.10 currently. But this is not an important ratio for a financial. The Debt Ratio for 2025 is fine but is a little low at 1.04 and 1.04 currently. The Leverage Ratio for 2025 are fine at 28% and currently at 28%.
| Type | Year End | Ratio Curr |
|---|---|---|
| Lg Term R | 4.10 | 3.11 |
| Lg Term A | 0.94 | 0.93 |
| Intang/GW | 0.26 | 0.20 |
| Liquidity | 1.03 | 1.10 |
| Liq. + CF | 1.06 | 1.23 |
| Debt Ratio | 1.04 | 1.04 |
| Fin Leverage | 28% | 28% |
The Total Return per Year is shown below for years of 5 to 37 to the end of 2025. Under the Capital Gain column is the portion of the Total Return attributable to capital gains. Under the Dividend column is the portion of the Total Return attributable to dividends. See chart below.
| From | Years | Div. Gth | Tot Ret | Cap Gain | Div. |
|---|---|---|---|---|---|
| 2020 | 5 | 6.85% | 22.47% | 17.40% | 5.07% |
| 2015 | 10 | 6.47% | 10.83% | 6.96% | 3.87% |
| 2010 | 15 | 4.67% | 10.41% | 6.48% | 3.93% |
| 2005 | 20 | 5.67% | 7.30% | 4.03% | 3.27% |
| 2000 | 25 | 8.40% | 8.80% | 5.31% | 3.50% |
| 1995 | 30 | 10.56% | 16.91% | 10.28% | 6.63% |
| 1990 | 35 | 11.04% | 18.41% | 11.44% | 6.98% |
| 1988 | 37 | 10.41% | 16.84% | 10.84% | 6.00% |
The 5-year low, median, and high median Price/Earnings per Share Ratios are 9.23, 10.64 and 11.99. The corresponding 10 year ratios are 9.95, 10.97 and 12.02. The corresponding historical ratios are 10.60, 12.36 and 13.64. The current ratio is 17.68 based on a stock price of $93.15 and EPS estimate for 2026 of $5.27. The current ratio is above the high ratio for the 10 year median ratios. This stock price testing suggests that the stock price is relatively expensive.
I also have Adjusted Earnings per Share (AEPS) data. The 5-year low, median, and high median Price/Adjusted Earnings per Share Ratios are 8.34, 9.82 and 11.31. The corresponding 10 year ratios are 8.78, 10.07 and 11.81. The corresponding historical ratios are 10.07, 12.07 and 13.27. The current ratio is 16.28 based on a stock price of $93.15 and AEPS estimate for 2026 of $5.72. The current ratio is above the high ratio for the 10 year median ratios. This stock price testing suggests that the stock price is relatively expensive.
I get a Graham Price of $54.70. The 10-year low, median, and high median Price/Graham Price Ratios are 0.73, 0.84 and 0.94. The current ratio is 1.77 based on a stock price of $93.15. The current ratio is above the high ratio for the 10 year median ratios. This stock price testing suggests that the stock price is relatively expensive.
I get a 10-year median Price/Book Value per Share Ratio of 1.59. The current ratio is 4.01 based on a Book Value of $20,796M, Book Value per Share of $23.25 and a stock price of $93.15. The current ratio is 152% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive.
I have a Book Value per Share estimate for 2026 of $30.53. This analyst determines the Book Value differently than I do and, in this case, the 10 year median dividend yield is 1.38. The ratio is 3.05 based on a Book Value of $27,380M, Book Value per Share of $30.53 and a stock price of $93.15. The current ratio is 120% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive.
I get a 10-year median Price/Cash Flow per Share Ratio of 4.98. The current ratio is 19.75 based pm Cash Flow for the last 12 months of $894.46M, Cash Flow per Share of $4.72 and a stock price of $93.15. The current ratio is 297% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive.
I get an historical median dividend yield of 3.86%. The current dividend yield is 2.88% based on dividends of $2.68 and a stock price of $93.15. The current dividend yield is 25% below the historical median dividend yield. This stock price testing suggests that the stock price is relatively expensive.
I get a 10 year median dividend yield of 5.16%. The current dividend yield is 2.88% based on dividends of $2.68 and a stock price of $93.15. The current dividend yield is 44% below the 10 year median dividend yield. This stock price testing suggests that the stock price is relatively expensive.
The 10-year median Price/Sales (Revenue) Ratio is 0.73. The current ratio is 2.03 based on Revenue estimate for 2026 of $41,066M, Revenue per Share of $45.91 and a stock price of $93.15. The current ratio is 179% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive.
Results of stock price testing is that the stock price is probably relatively expensive. The dividend yield testing is saying that the stock price is expensive and it is confirmed by the P/S Ratio test. All the testing is pointing to an expensive price. The TSX chart shows this stock just off its highest peak ever, so the stock testing as expensive is hardly a surprise.
When I look at analysts’ recommendations, I find Strong Buy (5), Buy (1), Hold (5), and Underperform (1). The consensus is a Strong Buy. The 12 month stock price consensus is $94.00 with a High of $111.00 and low of $68.00. The consensus stock price of $94 implies a total return of 3.79% with 0.91% from capital gains and 2.88% from dividends based on a current stock price of $93.15.
Analysts on Stock Chase like this stock, but some are worried about its high valuation. Jitendra Parashar on Motley Fool likes this stock because it has delivered for its shareholders over the past 10 years. Amy Legate-Wolfe on Motley Fool say that this company gives you financial sector exposure on a different lending cycle than banks like TD. However, she says it is also near its highs. The company put out a press release via Newswire about their fourth quarter of 2025. The company put out a press release via Newswire about their second quarter of 2026.
Simply Wall Street via Yahoo Finance reviews this stock. Some people think that this stock is overvalued and its fair value if $80.00 and others think it is undervalued and its fair value if $166.90. Simply Wall Street list no warnings for this stock
Great-West Lifeco is one of the Big Three Canadian life insurers with business in Canada, US, and Europe. Great-West Lifeco also offers various products across European markets with a strong presence in the UK and Ireland. Its web site is here Great-West Lifeco Inc.
The last stock I wrote about was about was Wajax Corp (TSX-WJX, OTC-WJXFF) ... learn more. The next stock I will write about will be Granite REIT (TSX-GRT.UN, NYSE-GRP.U) ... learn more on Friday, September 18, 2026 around 5 pm. Tomorrow on my other blog I will write about Canadian Banks Reporting Third Quarter Earnings.... learn more on Thursday, September 17, 2026 around 5 pm.
This blog is meant for educational purposes only and is not to provide investment advice. I am not a licensed professional investment advisor. Before making any investment decision, you should always do your own research or consult an investment professional. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.
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