SUN LIFE FINANCIAL $41.43 (Toronto symbol SLF; Shares outstanding: 612.1 million; Market cap: $25.6 billion; TSINetwork Rating: Above Average; Dividend yield: 3.7%; www.sunlife.ca) sells life insurance, savings, retirement and pension products to individuals and corporations. It has $812.6 billion of assets under management and mainly operates in Canada, the U.S. and the U.K. It’s also expanding in Asia.
In the three months ended March 31, 2015, Sun Life’s revenue rose 2.2%, to $3.72 billion from $3.64 billion a year earlier. Earnings per share gained 16.7%, to $0.84 from $0.72.
The company continues to expand its asset management business, which generates high profit margins and requires little capital investment. It recently paid $560 million for Bentall Kennedy Group, which manages more than $27 billion in real estate for over 550 institutional clients across the U.S. and Canada.
As well, Sun Life has just agreed to buy U.S. asset manager Prime Advisors for an undisclosed amount. Prime has about $13 billion under management, mainly bond portfolios for U.S. insurance firms. The stock trades at just 12.4 times Sun Life’s forecast 2015 earnings of $3.33 a share. The company raised its quarterly dividend by 5.6% with the June 2015 payment, to $0.38 from $0.36. It yields a high 3.7%.
Sun Life is a buy.
