Manulife Financial stock offerings – GuruFocus.com


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Manulife Financial (NYSE: MFC, 30-year Financials) stock is said to be slightly undervalued, according to GuruFocus’s valuation calculation. The GuruFocus Value is GuruFocus’s estimate of the fair value at which the stock is to trade. It is calculated based on the historical multiples at which the stock has traded, the company’s past growth, and analysts’ estimates of the company’s future performance. If a stock’s price is significantly above the GF value line, it is overvalued and its future performance may be poor. On the other hand, if it is significantly below the GF value line, its future return is likely to be higher. At its current price of $ 21.35 per share and a market cap of $ 41.4 billion, the Manulife Financial stock gives any indication that it is slightly undervalued. The GF value for Manulife Financial is shown in the table below.

Since Manulife Financial is relatively undervalued, the long-term performance of its stocks will likely outweigh the growth of its business, which has averaged 11.6% over the past five years.

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Companies with poor financial strength present investors with a high risk of permanent capital loss. To avoid a permanent loss of capital, an investor should do his research and consider the financial strength of a company before deciding to buy stocks. The two cash-to-debt ratio and covering a company’s interests are a great way to understand its financial strength. Manulife Financial has a cash-to-debt ratio of 1.87, which is around the average for companies in the insurance industry. The overall financial strength of Manulife Financial is 5 out of 10, indicating that the financial strength of Manulife Financial is fair. Here is Manulife Financial’s debt and cash flow over the past several years:

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It is less risky to invest in profitable companies, especially those that have demonstrated consistent profitability over the long term. A business with high profit margins is also generally a safer investment than a business with low profit margins. Manulife Financial has been profitable 10 in the past 10 years. In the past twelve months, the company reported sales of $ 57.5 billion and earnings of $ 2.198 per share. His operating margin is 0.00%, which ranks in the bottom 10% of companies in the insurance industry. Overall, GuruFocus ranks Manulife Financial’s profitability as 6 out of 10, indicating acceptable profitability. Here is Manulife Financial’s revenue and net income for the past few years:

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One of the most important factors in the valuation of a business is growth. Long-term stock performance is closely linked to growth, according to GuruFocus research. Firms that grow faster create more shareholder value, especially if that growth is profitable. Manulife Financial’s average annual revenue growth is 11.6%, which ranks higher than 78% of companies in the insurance industry. The 3-year average EBITDA growth is 27.9%, which ranks better than 88% of companies in the insurance industry.

A company’s profitability can also be assessed by comparing its return on invested capital (ROIC) to its weighted average cost of capital (WACC). Return on invested capital (ROIC) The extent to which a business generates cash flow relative to the capital it has invested in its business. The weighted average cost of capital (WACC) is the rate that a company should pay on average to all its security holders to finance its assets. If the return on invested capital exceeds the weighted average cost of capital, the company is likely to create value for its shareholders. Over the past 12 months, Manulife Financial’s ROIC is 0.79 while its WACC stood at 8.79. The historical comparison of Manulife Financial’s RCI and WACC is shown below:

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Overall, the stock of Manulife Financial (NYSE: MFC, 30 Financials) is estimated to be slightly undervalued. The company’s financial position is fair and its profitability is fair. Its growth ranks better than 88% of companies in the insurance sector. To learn more about Manulife Financial stocks, you can view its 30-year financial data here.

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