Analysts Still Positive On Manulife Despite Recent Results

While both UBS and Desjardins cut their forecasts for Manulife Financial Corp. (MFC) shares by C$1 to C$47 after the company’s first quarter results, they remain bullish on its prospects.

Jason Bilodeau says the possibility of Manulife spending some of its $3-billion in excess capital on a meaningful acquisition could be a key catalyst, although this may take longer than expected given the lack of willing sellers, the UBS analyst said in a note to clients.

“MFC remains well positioned to compete in its key existing businesses with brand, product and distribution and we expect MFC to deliver strong results over time,” he said, adding that current the weakness for its shares present a buying opportunity.

Over at Desjardins, Michael Goldberg noted that insurance sales appeared to have plateaued for Manulife, with the value of new business there falling significantly.

However, he added that Manulife has indicated it expects an uptrend in coming quarters and does not feel an acquisition is needed to re-establish growth.