Topic: How To Invest

Q: Pat, I am looking for information on Power Financial (PWF). Also, do you recommend the stock? Thank you as always.

Article Excerpt

A: Power Financial, $29.30, symbol PWF on Toronto (Shares outstanding: 664.1 million; Market cap: $19.8 billion; www.powerfinancial.com), holds majority interests in Great-West Lifeco, symbol GWO on Toronto, and IGM Financial, symbol IGM on Toronto. We currently see Great-West as a hold and IGM Financial as a buy. However, Power Financial also has a large stake in Pargesa Holding S.A. of Europe. In turn, Pargesa has large interests in a group of major European media, energy, utility and specialty minerals companies. We have much more confidence in Great-West Lifeco and IGM Financial than we do in these holdings. So, while Power Financial is okay to hold, we don’t see it as a buy. Instead, we think investors should stick with Great-West and IGM Financial, which we see as Power Financial’s highest-quality investments. Note also that Power Corporation, $29.49, symbol POW on Toronto (Shares outstanding: 414.4 million; Market cap: $12.7 billion; www.powercorporation.com), owns 65.6% of Power Financial. Power Corp. holds a number of interests outside of Power…

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