TSX:MFC - Post Discussion
Post by
morzine on Feb 03, 2022 8:17am
Globe & Mail - Barclays
Coming off research restriction, Barclays analyst John Aiken reinstated coverage of Manulife Financial Corp. (MFC-T) with an “overweight” rating and $36 target, exceeding the $31.21 average.
“Despite a strong rally to start off 2022, significant upside remains for MFC as we believe the market continues to undervalue its growth profile and reduced risk profile,” he said. “MFC retains strong leverage to a rising rate environment and continues to expand its high growth/high profitability businesses. While we do not expect the stock will approach a market multiple until its LTC exposure is dealt with, we believe that the 2.8 times P/E and 0.8 times P/B discounts are overly punitive and represent strong upside potential for investors.”
“We expect Manulife will rebound from a somewhat surprisingly weak third quarter, with the reinsurance losses not expected to recur. Further, one of the surprises in the third quarter was a 4.5-point increase in its efficiency ratio. We believe that this is transitory (with much of the losses coming from Global Wealth) and contributes to our expected recovery in profitability in the fourth quarter.”
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