IGM is your better choice for new growth

Article Excerpt

Today’s low interest rates tend to hurt the earnings of insurance providers like Great-West. That’s because they rely on strong returns from their bond and mortgage investments to help pay future claims. On the other hand, low rates should help IGM sell more mutual funds. Still, make no mistake, we see both as great choices for income investors. IGM, in particular, is tailormade for your new buying. GREAT-WEST LIFECO INC. $33 remains a hold for your income portfolio. The company (Toronto symbol GWO; Conservative Growth Payer Portfolio, Finance sector; shares outstanding: 928.9 million; Market cap: $30.7 billion; Dividend yield: 5.0%; Dividend Sustainability Rating: Above Average; www.greatwestlifeco.com) is Canada’s second-largest life insurer, after Manulife Financial. It also offers mutual funds and wealth management. Power Financial Corp. (Toronto symbol PWF) owns 67.7% of the firm. Starting with the March 2019 payment, the insurer raised your quarterly dividend 6.2%, to $0.413 a share from $0.389 a share. The new annual rate of $1.65 yields a high 5.0%. The company plans…

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