Canada's Manulife Q3 profit beats estimates

Overview

• Canada insurance and financial services firm's Q3 adjusted EPS beat analyst expectations

• Adjusted net income for Q3 also beat analyst expectations

• Net income fell 22% yr/yr, mainly due to market experience losses and Vietnam charges

Outlook

• Manulife did not provide specific financial guidance for the current or future periods

Result Drivers

• ASIA GROWTH - Double-digit core earnings growth in Asia driven by continued business expansion and improved claims experience, partially offset by higher expected credit loss provisions

• MARKET EXPERIENCE LOSSES - Net income declined due to lower than expected returns on alternative long-duration assets and public equities, as well as losses from derivatives and hedge accounting ineffectiveness

• ACTUARIAL REVIEW IMPACT - Annual review of actuarial methods and assumptions had a net favourable impact on core earnings, but also resulted in a decrease in pre-tax net income attributed to shareholders

Company press release:

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 10 "strong buy" or "buy", 4 "hold" and 1 "sell" or "strong sell"

• The average consensus recommendation for the life & health insurance peer group is "buy"

• Wall Street's median 12-month price target for Manulife Financial Corporation is C$67.50, about 7.5% above its November 3 closing price of C$62.80

• The stock recently traded at 13 times the next 12-month earnings vs. a P/E of 13 three months ago

Reuters Recommended Reads

• Nov 3 - Canadian insurer Intact Financial Q3 adj EPS misses estimates

• Nov 4 - MetLife's Q3 results beat estimates on volume growth, solid underwriting

• Nov 3 - AIG Q3 net premiums written rise on commercial, personal insurance growth

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)