TSX:MFC - Post Discussion
Post by
Mauserintime945 on Feb 17, 2023 8:26am
Barclays Upgrade
| Barclays on Manulife Q4 First Look, Notes Solid Earnings Despite Surprising Contribution from Corporate |
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07:42 AM EST, 02/17/2023 (MT Newswires) -- Barclays said in a note Manulife Financial (MFC.TO) posted better-than-expected Q4 results, with signs of improvement from its Asia segment, but a surprisingly strong contribution from the Corporate segment may be perceived as lower quality earnings. Manulife earned $0.88 per share on a core basis, above consensus of $0.81 and Barclays' forecast of $0.80, which was up 40% sequentially and 5% from a year ago, analyst John Aiken said in the note published late Wednesday. In conjunction with earnings, Manulife announced an 11% increase in its dividend from $0.035 per share to $0.365, a half penny above Barclays' expectations. This lifts the company's yield by over 50 basis points to 5.6%. In addition, Manulife announced its intention to repurchase an additional 3% of its outstanding shares after repurchasing over 4% in 2022, the note stated. Barclays said Asia showed some signs of recovery, which is a positive to Manulife's outlook, but it said that some of the positive sentiment on the strong beat will be tempered by the positive contribution from Corporate. It noted that while the wealth management contributions were down and saw net outflows, much of the top line pressure related to the pressure on average AUM and investment performance more than offset outflows. The bank said that while it would prefer a cleaner quarter, it views Manulife's underlying results as solid and believes that they, along with the 11% increase in dividend, should be supportive to its valuation. Barclays noted that Manulife, after banking over $1 billion in investment gains in the first three quarters that were not included in core earnings, was still able to report its $100 million investment gains in core in the quarter, despite posting a loss. Despite the losses weighing on reported earnings, they came in higher than core through a combination of reinsurance transaction gains and other market impacts, it noted. Barclays is Overweight on Manulife and has a price target of $28.00 on the stock. |
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