TSX:FFH - Post Discussion
Post by
retiredcf on Jul 24, 2024 8:03am
BMO
BMO analyst Tom MacKinnon provided top picks in a domestic insurance sector that has outperformed banks by 43.0 per cent to 16.0 per cent since the beginning of 2023,
“We remain bullish on lifeco group with attractive valuation (9.5 times NTM [next 12 months] core/underlying/base EPS, below 10-times average since GFC despite a much more favourable interest rate environment in 2024/2025), diminishing MTM [mark to market] real estate headwinds and favourable long-term interest rate tailwinds, favouring MFC, SLF and IAG, all of which had elevated share buybacks in Q2/24. SLF has the most to prove this quarter after missing Q1/24, but after reducing Q2/24E underlying EPS 3 per cent on weaker MFS AUM and weaker U.S. dental we remain skeptical for near term. While we reduce FFH Q2/24E estimates largely on expected MTM bond/equity losses (volatile, and are not ‘operating’) FFH remains top P&C pick, with attractive 1.2x P/BV valuation for a 13-per-cent 2025 ROE.”
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