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Research Alert: CFRA Keeps Buy Opinion On Shares Of Manulife Financial Corporation

05/07/2021 09:48

01:45 PM EDT, 05/07/2021 (MT Newswires) -- CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:

We lift our 12-month target by $1, to $24, or 9.1x our 2021 operating EPS estimate of $2.63 (C$3.20, converted at the 5/2/21 spot rate and upped from $2.59/C$3.15) and 8.5x our 2022 operating EPS estimate of $2.81 (C$3.42, raised from $2.72/C$3.30), versus MFC's 10-year average forward multiple of 9.8x and the peer average of 10x. Q1 operating EPS of $0.67 (C$0.82 versus $0.42 (C$0.51) topped our EPS estimate and the consensus forecast of $0.63 (C$0.77), as a 1% drop in operating revenues (below our forecast of 3% to 5% growth) offset margin gains that propelled Wealth Management profits up 29%, profits in Asia up 21%, Canada up 11%, and the U.S. up 28%. We cut our 2021 revenue forecast to flat to up 3%, and see growth of 4% to 6% in 2022, driven by strong new business activity. Our view is tempered by volatility in MFC's interest rate management activities, but trading at 8.1X our 2021 operating EPS estimate and yielding 3.3%, we view the shares as undervalued versus peer and historical averages.