Manulife Financial (MFC.TO)

Manulife (MFC-T) versus Sunlife (SLF.T). He is not sure what the issue with Manulife might be. He holds Manulife in his RRSP and would buy more if it pulled back to $22.65. Sunlife is doing a good job and is way over-performing Manulife.

He owns SLF-T as well. He would more likely move from SLF-T into MFC-T rather than the other way. He is surprised it is performing a badly as it is. This is a good level to get into MFC-T and they are growing the dividend. It is good to hold them both in this rising rate environment.

He recently added at the $25 level. Their growth areas are in Asia and Canadian insurance, but face problems in the U.S. which accounts for the recent downturn in share price. They're grow their Asian assets and wealth management business. The stock will rise as interest rates do.

He does not hold this now, but it does rank highly due to its dividend. He thinks their business continues to ramp up going forward. On a total return and income perspective, it is good value. Yield 3.6%. (Analysts’ price target is $30 )

Buy at $24.50 today and hold it for the dividend? It's not exactly a growth story, but they may sell parts of John Hancock which may translate into dividend increases. Don't step into it now, but hold it. It hasn't grown as much as she'd like. That said, the CEO will make changes to benefit the company.

Since 2007 it is the only financial that is still down from its peak. It has the most room for improvement. They have the ability to resolve all their issues and get the stock up. If he was going to buy a lifeco it would be this one.

(A Top Pick Feb. 1/17, Up 3%) It will do better in a rising interest rate environment. They've restructured since the financial sheet, and their balance sheet is much stronger. Strong, growing Asian operation is quite profitable. The new CEO will address their legacy businesses which have dragged on earnings. Bullish about lifecos, but MFC would be his top pick.

MFC-T vs. SLF-T. They are both in the right area. They do well seasonally at this time. He would favour SLF-T from a technical perspective. It has a rising bottom. It has pulled back down a little today. He favours banks over lifecos.

He is warm to the life insurance business, but does not own this. They over leveraged themselves during the financial crisis. They have some legacy US assets that have hurt their numbers. To unleveraged themselves to interests, it has hurt as interest rates have begun to rise. He questions their management decisions. If you own it, hold it, but there are better ones.

This is the insurance company they own in their portfolios. The company has pulled back below $25. You can start building a position here. She likes their 30% exposure in Asia, which provides higher growth. It has legacy problems in the US, such as John Hancock. They can’t just sell these, and they weigh on valuation. It will take a while to work through these issues, but she likes their asset management, their wealth management business and their core insurance business.

Not enthusiastic about the lifecos for the past five years. Lifecos have to invest for the long term, like buying long-yielding bonds, and have had a tough time making money. Also, MFC has had trouble growing its wealth management business which was supposed to offer healthy returns.

Line of support just under $25. Looks good at these levels and he'd buy it.

Heowns Sunlife instead. Of all the large Canadian financials, Manulife has the strongest earnings growth projections at 15% largely from more fees in asset management side and from their Asian enterprise. Sunlife has greater consistency in earnings growth and higher yield. Manulife's U.S. operations will benefit from U.S. tax cuts.

(A Top Pick Feb 2/17, Up 7.82%) He thinks the US banks are now a better place to be. It is still a great way to play a rising rate environment. He exited 3 or 4 months ago.

(A Top Pick Jan 18/17. Up 14%.) At the time he thought it was cheap relative to its peers. Also, there is a decent dividend and dividend growth. It’s still cheaper than its peers. He is modelling 10% earnings growth and 12% dividend growth.