Manulife Financial (MFC.TO)

Favourite Canadian lifeco and your 12 month outlook? The one that really stands out is Manulife (MFC-T). He likes that life insurance can re-price their products in the given market here. We are seeing premiums increasing. If this continues going the way it is, he could see $20 on this stock. 3% dividend yield.

The bond market won’t be favourable. Stock markets will be favourable but they hedged away some of the risk. The business is doing well as they get into China and India. Don’t rush in if you think there is a market correction coming.

Thinks this one works higher. Chart shows a nasty downtrend from 2009 and the trend was reversed in the latter part of 2012. We are currently going through a bit of congestion now. It will work its way higher, so there is more to come.

Feels this name was under owned for a long time. Thinks it continues to go higher over time. Earnings have been improving. Story has been improving. Last quarter they had lower new business strain, meaning lower costs. Have been controlling their expenses and are more efficient. Ultimately, it is a call on where interest rates are going and where equity markets are going. He feels that over time, both of them will go higher.

Rising rates are much more favorable to insurance than to the banks. A lot of that is already built into the price of insurance companies. There is probably a little more to go.

Has been recovering after the catastrophe of 2008-2009. Had a great run, but it hit his initial target of about $18 and has been setting back ever since. Has a downside target of about $15 where it would hit some good solid support and he would be interested in coming back to the stock at that time.

Over the last while, they have made progress but they were in a pretty deep hole. Feels there was a lot of speculative money that went into to the stock. On a multiple basis, it looks very expensive. Have some opportunities in the Orient, but there are risks attached to that. Yield is not that exciting. He would prefer Power Financial (PWF-T) or Sun Life (SLF-T) instead. If looking for yield, you could probably get a lot more out of bank stocks with a lot less risk.

In the short term will see weakness in light of fed announcements this week. You will see some money flow out of them but long term (3-5 years) you will see good growth. Wait a while if you are going to add more to it. Weakness in the near term. Has some Great West, no SLF, no MFC.

Very solid balance sheet. Highly levered to markets. You will need a lot for it to happen in order to go up. Prefers banks, BNS-T especially. It will be positive if they buy CI.

Expects we will see some fairly good results from life insurers’ reports that will be coming out shortly. They tend to do fairly well in environments where rates are moving up. This company is well-capitalized. Over the last number of years they have done much to de-risk the company.

(Market Call Minute.) This would be the conservative end of your portfolio. Market is performing quite well and they have to invest premiums and the lifecos are in favour again.

(Market Call Minute) Pretty fairly valued. Has a lot of exposure to Asia.

Has had a great run, relatives to some of the bank stocks and he prefers bank stocks at this particular point in time. (See Top Picks.)

This is one that you can wait for more, even though it is up 64%. This is a beneficiary of higher interest rates. A good hedge in the portfolio. Have done a much better job of hedging the equity portfolio. Decent yield that he feels is pretty secure.

Has benefited from both higher equity markets and rising interest rates. He would suggest that you could enter this one but not all at once. Stagger it is little bit.