Dividend Stock Analysis: Manulife Financial Corp. (TSE: MFC)
Seeing as how I did an analysis on Great-West Lifeco Inc. Last week, I figure I should do Manulife Financial and Sun Life Financial as well to see which one is the best option between the three. So, This week I give you my analsyis on Manulife Financial Corp. (TSE: MFC)
About the company:
Here is Manulife Financial Corps description of what they do, which can be found on their website here
What the professionals think:
| Source | Value | Score |
|---|---|---|
| Is it a Dividend Aristocrat: | Yes | 0.5 |
| Is it a Dividend Achiever: | Yes | 0.5 |
| Globe Investor Rating: | 4 Stars | 0.25 |
Score: 1.25/1.5
Dividend performance:
Dividend Information acquired at DividendInvenstors.ca
| Measurement | Value | Measurement | Value |
|---|---|---|---|
| Dividend Rate: | $2.80 | Quarterly Dividend Rate: | $0.70 |
| Current Dividend Yield: | 6.70% | 5 yr. Avg. Dividend Yield: | 3.20% |
| 3 yr. Dividend Growth: | 15.71% | 5 yr. Dividend Growth: | 17.03% |
| Payout Ratio: | 71.00% | 5 yr. Historic Payout Ratio: | 44.00% |
| Measurement | Value | Score |
|---|---|---|
| Is current Yield > Avg Yield: | Yes | 1 |
| > 10% dividend growth per year: | Yes | 1 |
| > 5 yrs of dividend growth: | Yes | 1 |
| payout ratio <= historic payout ratio: | No | 0 |
Score: 3.0/4.0
Fundamentals:
All fundamentals based on 2007 annual report, and the latest market close share price of $35.05
| Measurement | Value | Score |
|---|---|---|
| Earnings per share (EPS): | 2.81 | - |
| Is EPS growing: | Yes | 0.5 |
| Net Profit Margin: | 11.9% | - |
| Is Net Profit Margin growing: | Yes | 0.5 |
| Price/Book Ratio (P/B) < 0.80: | 2.16 | 0 |
| Price/Earnings Ratio (P/E) < 15: | 12.47 | 0.5 |
| Price/Sales Ratio (P/S) < 1.5: | 1.48 | 0.5 |
| Is the Graham Number > stock price: | $32.02 | 0 |
Score: 2.0/3.5
Technicals:
Chart Acquired at StockCharts.com
| Measurement | Value | Score |
|---|---|---|
| 200 day Simple Moving Average direction: | Down | 0 |
| Indicators show a good time to buy (MACD, SSTOCH, RSI): | No | 0 |
Score: 0/1.0
Total Score: 7.25/10
Notes:
- Both daily and weekly technical charts don't look too promising.
Summary:
Its not too often that we will get a tie between two stocks analysis but this just happened and if I am not mistaken, Great-West Lifeco and Manulife have both failed on the exact same tests as well. This goes to show you that this particular sector is a great location for dividend stocks, but right now, I don't think that they are ready for a turnaround. Like I said in the notes, the technicals aren't looking too good, so I think its going to be a little while yet before the techincals start to look promising for this sector. In any case, as long term dividend investors, we should still consider one of these stocks for our portfolios, and the scores from both show that they are both BUYs. Personally, I am going to keep waiting until the technicals look more optomistic on the price direction of the stocks though. Just like Great-West Lifeco, we are getting close to the Graham Number, so If the stock price drops below $32.02, I think it would be a good time to start investing as well.
Recommendation:BUY, but I would wait for the technicals to turn around, or until the stock price drops below $32.02
Full Disclosure: I currently do not own shares in Manulife Financial Corp. (TSE: MFC)
Disclaimer: Any information contained in the above article represents my opinions only, and should not be construed as personalized investment advice. I cannot assess, verify or guarantee the suitability of any particular investment to any particular situation and the reader of the article bears complete responsibility for its own investment research and should seek the advice of a qualified investment professional that provides individualized advice prior to making any investment decisions. All opinions expressed and information and data provided therein are subject to change without notice.
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