Manulife Financial may be undervalued with poor growth indicators, but the 3 analysts following the company give it an rating of hold. Their target prices range from $18.52 to $21.48 per share, for an average of $20.24. At today's price of $18.88, Manulife Financial is trading -6.72% away from its average target price, suggesting there is an analyst consensus of some upside potential for the stock.
Manulife Financial Corporation, together with its subsidiaries, provides financial products and services in Asia, Canada, the United States, and internationally. Based in Toronto, Canada, the large-cap Finance company has 40,000 full time employees. Manulife Financial has not offered a dividend over the last year.
Manulife Financial has a trailing twelve month P/E ratio of 7.1, compared to an average of 14.34 for the Finance sector. Based on its EPS guidance of 2.65, the company has a forward P/E ratio of 7.1.
The average compound growth rate of the company's historical and projected earnings per share is -0.9%. On this basis, the company's PEG ratio is -8.04, which indicates that its shares are overpriced.
On the other hand, the market is potentially undervaluing Manulife Financial in terms of its book value because its P/B ratio is 0.67. In comparison, the sector average P/B ratio is 1.57. The company's shares are currently -56.5% below their Graham number, indicating that its shares have a margin of safety.
If analysts are willing to give the company a bad rating despite its potentially attractive valuation, its likely that they are concerned by Manulife Financial's lacking growth potential, as signaled by its -33.4% rate of revenue growth, and capital expenditures that are only growing at None% on average each year.
| 2019-12-31 | 2020-12-31 | 2021-12-31 | 2022-12-31 | |
|---|---|---|---|---|
| Revenue (MM) | $77,822 | $77,121 | $59,841 | $15,284 |
| Interest Income | -$1,319,000 | -$1,181,000 | -$1,011,000 | -$1,350,000 |
| Net Margins | 6.77% | 6.91% | 11.12% | 47.0% |
| Net Income (MM) | $5,269 | $5,326 | $6,657 | $7,183 |
| Depreciation & Amort. | -$626,000 | -$656,000 | -$529,000 | -$538,000 |
| Earnings Per Share | $2.77 | $2.93 | $3.54 | $2.67 |
| EPS Growth | n/a | 5.78% | 20.82% | -24.58% |
| Diluted Shares (MM) | 1,962 | 1,943 | 1,946 | 1,850 |
| Free Cash Flow (MM) | $20,542 | $20,048 | $23,155 | $17,735 |
| Long Term Debt (MM) | $11,663 | $13,993 | $11,862 | $12,356 |
| Net Debt / EBITDA | -0.8 | -1.46 | -1.14 | -0.64 |
