Manulife Well Poised for Robust Growth in Canada, Asia

On Dec 4, we issued an updated research report on Manulife Financial Corp. (MFC).

With a market capitalization of $36 billion, Manulife is the 3rd largest life company in North America and among the largest worldwide.

It has a broad distribution platform with independent financial advisors, bancassurance, and managing general agencies marketing its products across the globe.

Manulife also has an extensive asset management footprint globally, providing a full spectrum of investment capabilities to retail and institutional clients.

While Manulife is a strong player in Canada, to further accelerate business growth, the company announced in Sep 2014 that it will acquire Standard Life Overseas Holdings of Standard Life plc. The acquisition will enhance the scale of the company’s core businesses – Group Retirement, Mutual Funds and Group Benefits.

Its presence in Asia, which dates back to over a century ago, gives it a competitive advantage. Changing demographics have fueled demand for insurance and wealth management products in this region and the company will likely benefit from this owing to its longstanding presence and reliability.

The company is financially strong with MCCSR of 248%, S&P Insurance financial strength of AA- and leverage ratio of 27%.

Nevertheless, foreign exchange volatility, growing expenses and low interest rates continue to be some of the headwinds.

Manulife carries a Zacks Rank # 3 (Hold). Better-ranked stocks include, Lincoln National Corp. (LNC) and Protective Life Corp. (PL) and StanCorp Financial Group Inc. (SFG). All these stocks carry a Zacks Rank #2 (Buy).