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CI Financial Corp T.CIX

Alternate Symbol(s):  CIXXF

CI Financial Corp. is a diversified global asset and wealth management company operating primarily in Canada, the United States and Australia. The Company is engaged in the management and distribution of a range of financial products and services, including wealth management, insurance, and others. The Company operates through three segments: Asset Management, Canadian Wealth Management, and U.S. Wealth Management. The Asset Management segment includes CI Global Asset Management, which operates in Canada, and GSFM Pty Ltd., which operates in Australia. The Canadian Wealth Management segment includes the operations of CI Assante Wealth Management, Aligned Capital Partners, CI Private Wealth, Northwood Family Office, CI Direct Investing and CI Investment Services. The U.S. Wealth Management segment includes Corient Private Wealth LLC, an integrated wealth management company providing comprehensive solutions to ultra-high-net-worth and high-net-worth clients across the United States.


TSX:CIX - Post by User

Post by zack50on Oct 31, 2022 9:25am
360 Views
Post# 35059701

Analyst Coverage...

Analyst Coverage...

Scotia Capital analyst Phil Hardie thinks the operating environment for the Canadian asset & wealth management sector has become “increasingly challenging through 2022 with heightened market volatility and a range of lingering uncertainties.”

However, heading into third-quarter earnings season, he thinks valuations “remain discounted.”

“A difficult market backdrop and an uncertain economic outlook have likely eroded retail investor confidence and negatively impacted retail flows,” said Mr. Hardie in a note. “Industry-wide outflows of long-term assets (ex-money markets) improved sequentially in Q3, but net redemptions accelerated in September following some improvements earlier in the quarter.

“Despite the near-term pain of this environment, the opportunity for wealth managers is to demonstrate the value of sound advice to clients through a complex environment. The difficult backdrop also likely offers asset managers the chance to successfully demonstrate the value of active management strategies and tailored solutions over basic passive approaches.”

He made a series of target price adjustments on Monday:

  • AGF Management Ltd. “sector perform” to $8.50 from $7.50. 
  • CI Financial Corp. “sector perform” to $17 from $18. 
  • Fiera Capital Corp. “sector perform”) to $11 from $10. 
  • Guardian Capital Group Ltd. “sector outperform” to $40 from $42. 

“We have the sector on our radar, but given the current environment and an uncertain outlook, we remain on the sidelines for now, except for Guardian, which we view as the least sensitive to AUM fluctuations,” said Mr. Hardie. “Our top beta plays in a broad market recovery scenario include CI Financial and AGF. CI likely offers significant upside potential in a blue-sky market rebound scenario, with a number of potential catalysts on the horizon including the IPO of its U.S. wealth management platform. That said, given its ongoing transformation, CI also likely has a set of unique risks, and presents the biggest downside risk across our asset managers. We continue to believe that IGM offers the most defensive attributes of the group, but likely yields less upside potential relative to the group given our current outlook.

“We continue to believe Guardian’s discount is too steep to ignore, and it remains our top small-cap value play.”

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