Manulife Q4 Profit Grows 17%; Boosts Dividend 18%

Manulife Financial (TSE: MFC) (NYSE: MFC) posted strong performance for the full-year 2021, as well as in the fourth quarter.

The quarterly dividend was increased by 18% in the quarter. The Toronto-based insurance and financial services company is looking to further expand its business in Asia.

Q4 Results

Manulife made record profits last year, with its fourth-quarter net profit rising 17% to C$2.08 billion.

Profit attributable to shareholders reached C$7.1 billion in 2021, up 21% from C$5.87 billion in 2020, thanks to its insurance activities.

For the three months ended December 31, the insurer earned C$1.03 per diluted share, down from C$0.89 per share or C$1.78 billion a year earlier.

Core earnings were C$1.71 billion (C$0.84 per share) in Q4 2021, compared to C$1.47 billion (C$0.74 per share) in Q4 2020.

Base earnings for the full year were C$6.54 billion (C$3.25 per share), compared to C$5.52 billion (C$2.75 per share) a year earlier.

New business increased to C$555 million in the quarter and C$2.24 billion for the year, with Asia contributing C$391 million and C$1.67 billion, respectively.

CEO Commentary

Manulife president & CEO Roy Gori said, “We are scaling our business to grow across the diverse markets in Asia and in 2021 commenced a 16-year bancassurance partnership with VietinBank, one of the largest financial institutions in Vietnam, that enables a full suite of insurance, wealth and retirement solutions to be made available to customers in Vietnam. We also continued to make significant progress on our portfolio optimization commitments, as evidenced by the announcement of our U.S. variable annuity reinsurance transaction with Venerable Holdings Inc., which closed in early February.”

Wall Street’s Take 

Following the results, Canaccord Genuity analyst Scott Chan kept a Buy rating on MFC with a price target of C$30.5. This implies 9.8% upside potential.  

The rest of the Street is cautiously optimistic on MFC with a Moderate Buy consensus rating based on four Buys and five Holds. The average Manulife Financial price target of C$31.27 implies 12.5% upside potential to current levels.  

TipRanks’ Smart Score 

MFC scores an 8 out of 10 on TipRanks’ Smart Score rating system, indicating that the stock returns are likely to beat the overall market. 

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