Power Financial Corp (PWF.TO)

Manulife (MFC-T) or Power Financial (PWF-T)? This one is more into Investors Group and Great West Life. Great West is basically health benefits and the demand is there, so it is inelastic. Manulife is in life insurance and other things that are little bit riskier. He prefers Chubb Ltd (CB-N).

He has not looked at it in detail for a while so can’t comment on the safety of the dividend. We are not early in the financial recovery and this could impact the earnings for this company. It is into the range of the low last year. He would consider adding to his holding.

Part of the thesis with a lot of these insurance plays was that interest rates were going to go higher and would happen faster, and would benefit insurance companies. However, you are getting this “lower for longer” mentality. Expects interest rate increases are going to be shallow for a very long time. He would be happy holding this for years.

A holding company in financial services. The family that owns this hires very good people to run their companies. There are 3 major parts. They are the biggest shareholder in Great West Lifeco (GTO-T). The 2^nd part is IGM Financial. The 3^rd part is Pargesa, which owns a lot of companies in Europe. Have good interest rate exposure. Dividend yield of 4.41%.

Power Corp. (POW-T) or Power Financial (PWF-T)? Doesn’t like either. Power Corp. owns Power Financial, but at the end of the day, you really own Power Financial as that is the only asset that is in there. The underlying assets of Investors Group and Mackenzie Financial are a bit of a challenged market going forward. He would prefer owning just Great West Life (GWO-T) which is part of Power Corp. also.

The stock has dropped to what he considers a breakpoint. Because the balance sheet is growing fast enough, nothing very much happened to the price. It gives you exposure to Great West Life (GWO-T). A cheap stock with a very nice yield.

Until recently, this was trading near its asset value. It has dipped along with everything else, but the group has always had good valuations and a good reputation. There has been no discount in it for the structure.

Power Corp has the subsidiary of Power Financial (PWF-T) which has its own subsidiaries. How do you decide which one to buy into? Has looked into this whole process and ended up buying this one (PWF-T), mainly because of the European investments that it tends to have. Also, the yield is better. He has been unhappy with the performance on a market value basis, and yet the numbers are good. Hoping for a dividend increase before too long.

People are constantly trying to measure their NAV on a go forward kind of basis. It is their exposure to IGM that has been pulling them back and where they have lost market share. Dividend yield of close to 4.5%.

(A Top Pick Aug 1/14. Down 1.10%.) This is the Demarais’ family holding company. Its main assets are controlling positions in Great West Life (GWO-T), Putnam in the US and IGM. Likes the long term outlook for Great West life in particular, but also the money management business. In the short term, Great West Life is having a few headwinds, and all the money manger businesses are under pressure. Recently raised their dividend, and can see that continuing on a regular basis.

An attractive yield is why they hold it. Earnings growth has been a bit muted. The discount from NAV has gone from 10 to 16%. It is just a matter of time for the discount to narrow back to its historical range.

This and Power Corp. (POW-T) would raise their dividends every year, and then they got slammed by 2008-2009. Each of them just increased their dividends in 2015 for the 1^st time in years. He is hopeful this will continue. On a Price to Book basis, they are extremely cheap versus their holding and insurance companies. Valuations are attractive here. (See Past Picks.)

He likes it. It looks like the dividend growth that stalled out will resume. You get an indirect play on Investors Group and Great West Life.

For somebody who wants a nice safe dividend and potential for dividend growth, with good diversification in the financial industry (non-bank and less bothered by excess regulation), with US and Canadian investments. Good management. Dividend yield of 4.05%.

(Market Call Minute.) They are finally now in the mode of raising their dividend and getting better growth.