Yahoo Finance Reasons Why You Should Add Sun Life (SLF) to Your Kitty Now
Sun Life Financial’s SLF focus on Asia operations, its strengthening asset management businesses, the scale-up of its U.S. operations and a strong financial position bode well for growth.
Earnings Surprise History
Sun Life has a decent track record of beating the Zacks Consensus Estimate for earnings in three of the last four quarters while meeting once, the average being 3.32%.
Northbound Estimate Revision
The Zacks Consensus Estimate for 2024 and 2025 earnings has moved 20% and 2% north, respectively, in the past 60 days, reflecting analyst optimism.
Zacks Rank & Price Performance
Sun Life currently carries a Zacks Rank #2 (Buy). In the past year, the stock has gained 18.9% compared with the industry’s growth of 31.6%.
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Optimistic Growth Projections
The Zacks Consensus Estimate for Sun Life’s 2024 earnings per share indicates a year-over-year increase of 8% from the consensus estimate of 2023.
The consensus estimate for 2025 earnings per share indicates a year-over-year increase of 7.3% from the consensus estimate of 2024.
Business Tailwinds
Sun Life is strengthening its presence in the Asia market, which provides higher returns and growth than the North American markets. The contribution of Asia to Sun Life’s earnings has increased to 21% from 8% over the last few years.
The third largest insurer in Canada is improving its business mix and is thus shifting its growth focus toward products that block lower capital and offer more predictable earnings. Sun Life looks to be one of the top five players and remains focused on growing its voluntary benefits business.
In its effort to strengthen Asset Management, Sun Life Investment Management makes investments in private fixed-income, mortgages and real estate. It invests in pension plans and other institutional investors. Notably, Asset Management provides a higher return on equity, lower capital and volatility and has the potential for an earnings upside.
Operational efficiency has been aiding Sun Life in building a strong capital position. The life insurer’s capital outlay includes a 40-50% dividend payout over the medium term. Also, given the company’s ongoing shift to fee-based capital-light businesses, it reiterated its medium-term ROE target of 18%.
SLF also has Value Score of A. This style score helps find the most attractive value stocks. Back-tested results have shown that stocks with a Value Score of A or B combined with a Zacks Rank #1 (Strong Buy) or #2 are best investment bets.
Other Stocks to Consider
Some other top-ranked stocks from the insurance industry are Manulife Financial Corporation MFC, Primerica Inc. PRI and Axis Capital Holdings Limited AXS, each carrying a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Manulife delivered a four-quarter average earnings surprise of 7.01%. In the past year, MFC shares have gained 35.6%.
The Zacks Consensus Estimate for MFC’s 2024 and 2025 earnings implies year-over-year growth of 5.4% and 9.7%, respectively, from the consensus estimate of the corresponding years.
Primerica delivered a four-quarter average earnings surprise of 3.1%. In the past year, PRI shares have gained 52.7%.
The Zacks Consensus Estimate for PRI’s 2024 and 2025 earnings implies year-over-year growth of 10.4% and 10%, respectively, from the consensus estimate of the corresponding years.
Axis Capital has a solid track record of beating earnings estimates in each of the trailing four quarters, the average being 102.57%. In the past year, AXS has gained 19.2%.
The Zacks Consensus Estimate for AXS’ 2024 and 2025 earnings implies year-over-year growth of 3% and 10%, respectively, from the consensus estimate of the corresponding years.
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Axis Capital Holdings Limited (AXS) : Free Stock Analysis Report
Manulife Financial Corp (MFC) : Free Stock Analysis Report
Primerica, Inc. (PRI) : Free Stock Analysis Report
Sun Life Financial Inc. (SLF) : Free Stock Analysis Report
