MANULIFE FINANCIAL $22.36 - Toronto symbol MFC

MANULIFE FINANCIAL $22.36 (Toronto symbol MFC; Shares outstanding: 1.9 billion; Market cap: $41.2 billion; TSINetwork Rating: Above Average; Dividend yield: 2.8%; www.manulife.ca) sells insurance, mutual funds and wealth management services. The company operates globally and has $637 billion of assets under management.

The company has just announced strong quarterly results and a 19.2% dividend increase, to $0.155 a share from $0.13. The stock yields 2.8%.

This is the first hike since Manulife cut its payout by 50% in 2009 to preserve capital after 2008’s stock market declines.

In the three months ended June 30, 2014, Manulife’s earnings per share rose 16.1%, to $0.36 from $0.31 a year earlier. Revenue gained 3.7%, to $9.2 billion from $8.8 billion.

Manulife has eliminated many of the riskier products its U.S. business offered.

At the same time, the company continues to steadily increase its share of expanding Asian markets. Right now, about a third of Manulife’s insurance premiums come from its operations in Japan, China, Hong Kong, Thailand, Malaysia, Indonesia, Singapore and the Philippines.

The stock has risen 28% over the past year, but it trades at just 10.4 times Manulife’s latest 12 months of earnings. The company depends on its U.S. operations for about half of its earnings, but the U.S. economy is steadily recovering.

Manulife is now a buy.

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