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On Friday, RBC Capital Markets increased its price target for Manulife Financial (NYSE:MFC:CN) (NYSE: MFC) shares to Cdn$51.00, up from the previous Cdn$49.00, while reaffirming an Outperform rating on the stock. Trading near its 52-week high with a 38.5% return over the past year, the company’s stock has shown remarkable momentum. The firm’s analyst highlighted Manulife Financial’s strong core earnings per share (EPS), which exceeded expectations, particularly noting the impressive performance of the Corporate segment. This segment’s earnings were bolstered by higher-than-anticipated earnings on surplus, a portion of which may be sustainable. According to InvestingPro data, the company maintains an impressive "GREAT" financial health score of 3.0 out of 4.0.
Manulife Financial has been recognized for its consistent solid earnings across all segments, with a robust revenue growth of 35.5% in the last twelve months. The recent quarter brought attention to the Global Wealth and Asset Management (GWAM) division’s notable results. Additionally, the company has announced a substantial dividend increase and plans for further share buybacks. InvestingPro analysis reveals that Manulife has maintained dividend payments for 26 consecutive years, with a current yield of 3.6% and a 7.7% dividend growth in the last year.
The analyst from RBC Capital Markets expressed a cautious optimism, opting for conservative adjustments to their estimates. This conservative stance is based on the belief that some of the recent positive financial results may normalize at lower levels. Despite this, the firm’s confidence in Manulife Financial’s performance is reflected in the upgraded price target, signaling continued support for the Outperform rating.
Manulife Financial’s recent achievements in earnings and strategic financial management have been met with positive responses from the market. The company’s ability to hit key milestones and deliver on its financial promises reinforces its position in the industry and the confidence that analysts have in its future performance. With RBC Capital Markets’ updated price target, Manulife Financial’s stock continues to be seen as a strong performer in its sector.
In other recent news, Manulife Financial reported a significant 62% year-over-year increase in Asia sales for the fourth quarter of 2024, alongside a 35% growth in new business CSM. The company also achieved remittances totaling $7 billion, representing 90% of its core earnings for the year, after accounting for a $0.75 billion reinsurance transaction. BMO Capital Markets raised its price target for Manulife shares from Cdn$50.00 to Cdn$52.00, maintaining an Outperform rating, reflecting the insurer’s strong performance and potential for further valuation re-rating. Additionally, Manulife finalized a reinsurance transaction with Reinsurance Group (NYSE:RGA) of America, covering two segments of its legacy long-term care business. This move is part of Manulife’s strategy to enhance shareholder value and refocus its portfolio towards higher returns. The company also announced the appointment of Nancy Carroll and John Montalbano to its Board of Directors. Carroll and Montalbano bring extensive experience in financial services, insurance, and asset management, which is expected to strengthen the company’s governance and strategic planning. These developments highlight Manulife’s ongoing efforts to optimize its operations and financial health.
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