Opinions
Colin Stewart
Genworth Financial Inc
GNW-N
WAIT
Oct 25, 2016
$4.570
Stock price when the opinion was issued
insurance
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A life insurance company with a long track record of profitability. A spin out from General Electric. General Electric will be selling the last third in the next month. When/if this happens, there will probably be a dip which will be a good time to get into the stock. You might see it $1/2 lower.
insurance
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Stockchase Research Editor: Michael O'Reilly GNW is a long term care and mortgage insurer company. For the past four years, the company has been off analyst radar screens since it was in talks to be acquired by a Chinese company for $5.43 per share. Management officially ended the merger discussions this month, after 17 failed extensions. The company has been paying down debt and currently holds estimated cash reserves equivalent to $5.36 per share, yet the stock trades under $4.00. The company is looking to unlock trapped value in the mortgage insurance side of the business via a IPO. We would buy this with a stop loss at $3.00, looking to achieve $5.50 -- upside over 37%. Yield 0% (Analysts’ price target is $5.95)
insurance
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Mortgage insurer. This has traded at a low valuation multiple, and there have been concerns around the business for the last number of years, as people are worried about the Canadian housing market getting overheated and a possible correction. New mortgage regulations will curb business to some degree, and lead to a situation where maybe the quality of their customers are going to be higher, but with less people qualifying, giving potentially lower earnings. He would not be a buyer at this time as there are too many uncertainties as to how the new regulations are going to impact the mortgage insurance market, and more broadly what is going to happen to the Canadian housing market. Dividend yield of 5.8%.