MFC or SLF: Which Is the Better Value Stock Right Now?
Investors interested in Insurance - Life Insurance stocks are likely familiar with Manulife Financial (MFC) and Sun Life (SLF). But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.
The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Manulife Financial has a Zacks Rank of #1 (Strong Buy), while Sun Life has a Zacks Rank of #3 (Hold) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that MFC is likely seeing its earnings outlook improve to a greater extent. But this is just one piece of the puzzle for value investors.
Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks that they believe are undervalued at their current share price levels.
The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.
MFC currently has a forward P/E ratio of 7.91, while SLF has a forward P/E of 11.98. We also note that MFC has a PEG ratio of 0.79. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. SLF currently has a PEG ratio of 1.33.
Another notable valuation metric for MFC is its P/B ratio of 0.79. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, SLF has a P/B of 1.63.
Based on these metrics and many more, MFC holds a Value grade of B, while SLF has a Value grade of C.
MFC stands above SLF thanks to its solid earnings outlook, and based on these valuation figures, we also feel that MFC is the superior value option right now.
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Manulife Financial Corp (MFC) : Free Stock Analysis Report
Sun Life Financial Inc. (SLF) : Free Stock Analysis Report
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