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Investing.com - Scotiabank (TSX:BNS) has resumed coverage on Sagicor Financial Company Ltd. (TSX:SFC) with a Sector Outperform rating and a price target of $10.00.
The price target implies a potential total return of 30% including dividends, according to Scotiabank’s analysis. The firm calculated the target by applying a 0.9x price-to-book value multiple on its 2026 book value per share estimate.
This valuation represents a 49% discount to the average multiple Scotiabank applies to larger life insurance companies, which the firm believes is justified by Sagicor’s lower return on equity (ROE).
Scotiabank highlighted Sagicor’s ongoing strategic transformation, which includes geographic diversification into Canada and better alignment of capital to higher-growth segments of the U.S. market.
The firm noted that Sagicor, as the smallest publicly traded life insurance company in Canada, often goes unnoticed by investors but sees strong upside potential if management can execute its strategy and move the company’s ROE toward its 13% target.
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