manulife financial
Toronto symbol MFC, sells life and other forms of insurance, as well as mutual funds and investment management services. It operates in 19 countries and territories worldwide.
At one time, mutual funds within a particular ‘fund family’ often shared some key investment characteristic, such as a conservative or aggressive investment approach, or a stress on value as opposed to growth. However, due to trends in the mutual-funds industry such as corporate mergers and takeovers, and more aggressive marketing, a fund’s membership in a fund family now has little bearing on its investment approach or appeal as an investment. Below, for instance, we analyse five funds from the Ivy Group. (Note that Ivy is now part of Mackenzie Financial, which in turn is part of IGM Financial. The contact information listed for Ivy Growth and Income also applies to the other four.)...
MANULIFE FINANCIAL $39.22 (Toronto symbol MFC; SI Rating: Above-average) sells life and other forms of insurance, as well as mutual funds and investment management services. It operates in 19 countries and territories worldwide. Manulife has assets under administration of $414 billion, up 11.4% from $371.5 billion at the end of 2005. In the three months ended December 31, 2006. Manulife’s earnings rose 14%, to $1.1 billion or $0.70 a share, from $908 million or $0.56 a share a year earlier. Revenue rose 9.5%, to $9.2 billion from $8.4 billion. The shares yield 1.8%. Manulife’s operations are well diversified among life and health insurance, segregated mutual funds, and reinsurance. Its geographic diversification in the U.S. and Asia, including China, offers growth prospects....
We’ve said for some time that insurers are riskier than they look. Insurance has a stable image, but it has always been highly competitive and volatile. For safety-conscious investors, right now we recommend just three Canadian insurance companies as buys: Manulife Financial, Great-West Lifeco and Sun Life Financial. SUN LIFE FINANCIAL $50.54 (Toronto symbol SLF; SI Rating: Above-average) offers savings, retirement, pension and life and health insurance products and services to individuals and corporations. The company operates mainly in Canada, the U.S. and the UK, and also in Asia and India. It has assets under administration of $436.5 billion. In the three months ended December 31. 2006, Sun Life’s earnings rose 14%, to $545 million or $0.95 a share, from $478 million or $0.82 a share a year earlier. Revenue rose 15%, to $6.1 billion from $5.3 billion a year earlier. The company recently raised its quarterly dividend by 6.7%, to $0.32 from $0.30. The shares now yield 2.4%....
CIBC CANADIAN EQUITY FUND $25.59 (CWA Rating: Conservative) (CIBC Securities, 5140 Yonge Street, Suite 900, Toronto, Ontario M2N 6X7. 1-800-631-7008; Website: www.cibc.com. No load — deal directly with the company.) uses a “bottom-up” approach (using fundamentals such as earnings, cash flow and low debt) to identify companies that trade at reasonable valuations and yet have growth potential. The $644.5 million fund’s top holdings are Petro- Canada, EnCana, Manulife Financial, Teck Cominco, Bank of Nova Scotia, TD Bank, Canadian National Railway, Bank of Montreal, National Bank and Suncor Energy. CIBC Canadian Equity holds 39.4% of its portfolio in Financial services stocks and 24.1% in Energy stocks....
BMO EQUITY FUND $31.63 (BMO Mutual Funds, 77 King Street West, Suite 4200, Royal Trust Tower, Toronto, Ont., M5K 1J5, 1-800-665-7700; Web site: www.bmo.com. No load — deal directly with the bank) (CWA Rating: Conservative) generally invests in the shares of 20 to 40 “blue-chip” Canadian companies. These stocks are selected based on the manager’s outlook for the industry they operate in, the earnings record of each company, the strength of management, and the potential for growth. BMO Equity Fund’s 10 largest holdings are Manulife Financial, Suncor Energy, Royal Bank, TD Bank, Sun Life Financial, EnCana Corporation, Barrick Gold, CIBC, Bank of Nova Scotia and Telus. The $2.2 billion fund currently holds 35.9% of its portfolio in the Financial services industry. Its next-largest holding is Energy at 20.0%....
RBC CANADIAN EQUITY FUND $27.30 (CWA Rating: Conservative) (RBC Funds, P.O. Box 7500, Station A, Toronto, Ontario. M5W 1P9. 1-800-463-3863; Web site: www.royalbank.com. No load — deal directly with the bank) invests mostly in larger-capitalization stocks, but also looks for opportunities in small and mid-cap stocks. The fund’s 10 largest holdings are TD Bank, Manulife Financial, Bank of Nova Scotia, Royal Bank, EnCana, Barrick Gold, CN Railway, CIBC, Suncor Energy and Bank of Montreal. The $4.7 billion fund holds 31.6% of its holdings in Financial stocks. It also holds 21.5% in Energy stocks....
Here are five large funds run by each of Canada’s big-five banks. Each holds the kind of conservative, well-balanced portfolios of high quality stocks we like. All five have a high weighting in Financial services and Energy stocks. However, they stick with high-quality issues with sound fundamentals, so these concentrations don’t add a lot of risk. Each has its quirks, but overall they are well positioned for low-risk returns. TD CANADIAN EQUITY FUND $30.40 (CWA Rating: Conservative) (TD Asset Management, P.O. Box 7500, Station A, Toronto, Ontario. M5W 1P9. 1-800-463-3863; Web site: www.tdcanadatrust.ca. No load — deal directly with the bank) uses a “bottom-up” approach (using fundamentals such as earnings, cash flow and low debt) to identify undervalued companies with strong growth potential. TD Canadian Equity Fund’s 10 largest holdings are Bank of Nova Scotia, Suncor Energy, Royal Bank, TD Bank, Rogers Communications, Canadian Oil Sands Trust, CN Railway, Tim Hortons, Canadian Natural Resources and Teck Cominco....
AIC DIVERSIFIED CANADA FUND $46.74 (CWA Rating: Conservative) mainly holds shares of Canadian companies of average or above-average quality. It also holds stocks of some U.S. firms. The $1.7 billion fund’s 10 largest holdings are Power Financial, Canadian Oil Sands Trust, TD Bank, Shoppers Drug Mart, Loblaw, Thomson Corp., Brookfield Asset Management, Royal Bank, Manulife Financial and Royal Bank of Scotland. The fund holds just 23 stocks. The fund holds 47.8% of its assets in Financial services stocks. The rest of the portfolio breaks down as follows: Consumer staples, 19.4%; Energy, 8.6%; Consumer discretionary, 7.6%; and Health care, 5.5%....
These two AIC funds hold much of their portfolios in financial services stocks. We prefer diversified funds. But if you must focus on something, finance is a relatively stable sector. If you do invest in these funds, be sure to adjust the rest of your portfolio so they won’t overly concentrate your stock and mutual fund holdings in the financial sector. AIC AMERICAN ADVANTAGE FUND $8.21 (CWA Rating: Aggressive) (AIC Group of Funds, 1375 Kerns Road, Burlington, Ont., L7R 4X8, 1-800-263-2144; Web site: www.aicfunds.com. Buy or sell through brokers) invests mostly in U.S. stocks, with over 99% of assets in the financial services area....
FIDELITY TRUE NORTH FUND $27.95 (CWA Rating: Conservative) (Fidelity Investments Canada, 483 Bay St., Suite 200, Toronto, Ont. M5G 2N7. 1-800-263-4077; Web site: www.fidelity.ca. Load fund — available from brokers) uses a “bottom-up” approach (using fundamentals such as earnings, cash flow and low debt) to identify undervalued companies. Fidelity True North Fund’s top holdings include high-quality stocks such as Manulife Financial, Nexen, TD Bank, Sun Life Financial, Canadian Natural Resources, Bank of Nova Scotia, Telus Corporation, Rogers and Talisman Energy. The $6.2-billion Fidelity True North Fund’s one-year gain is 20.2%, compared to a gain of 20.6% for the S&P/TSX over the same period. The fund’s MER is 2.55%....