ridiculously cheap The company is ridiculously cheap with a price-to-earnings ratio of 9.13, a price-to-book ratio of 3.03, and market cap of 4.69 billion. The company has been opportunistically buying back a huge amount of stock in the market for the last several years and has significantly shrunk the outstanding share count. Leverage is utilized very conservatively by the company, as evidenced by a debt-to-equity ratio of just 1.04. The most fascinating part about CI Financial is the level of profitability achieved consistently, as demonstrated by an operating margin of 39.16% and return on equity of 33.71%, which is phenomenal in the current low interest rate environment.
The company has $129.3 billion in assets under management and $41.8 billion in assets under advisement.
CI Financial posted record earnings per share and record free cash flow for the year in spite of the fact that the asset management industry is facing a very challenging time due to increased volatility which impacts investment performance and industry sales levels. The industry is also undergoing a secular transformation driven by forces that include more stringent regulation, huge focus on management fees, digitalization, and heightened competition from incumbents and new entrants. In response, the company has responded admirably by focusing on acquisitions, buybacks, and consistent, long-term organic growth in the Canadian market.
Further, the company’s advisory businesses of Assante Wealth Management and CI Private Counsel, have posted excellent growth numbers, making CI one of the largest managers of high-net-worth assets in Canada.
CI Financial appears to be an excellent long-term investment at the current market price.