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Manulife Financial (MFC) & its Units Get Rated by A.M. Best
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Manulife Financial Corporation (MFC - Free Report) and its units recently received rating action from credit rating giant, A.M. Best. The rating agency has affirmed the Long-Term Issuer Credit Ratings (Long-Term ICR) of “a-” and the existing Long-Term Issue Credit Ratings (Long-Term IR) of Manulife Financial.
At the same time, the rating giant affirmed the Financial Strength Rating (FSR) of A+ (Superior) and the Long-Term ICR of “aa-” of the life insurer’s affiliates.
Manulife Financial’s rating affirmation reflects its strong risk-adjusted capitalization, robust liquidity position and solid global business profile in Asia, Canada and the United States. This apart, the ratings indicate the life insurer’s sustained operational performance over the last five years. In addition, the company’s improved scale of core business lines, increased net flows and fee-based revenues, especially within Asia and the global wealth asset management (WAM) business segment, have supported the ratings.
Moreover, the life insurer has been benefited by some of its recent buyouts. Its strategic partnerships in North America and Asia as well as organic growth leading to substantial increases in assets under management and administration raise optimism. Such positives are also represented by the aforementioned ratings affirmation. The credit rating giant strongly believes that these positive rating factors will enable Manulife Financial to improve its growing global market position, particularly the WAM business segment, in the intermediate future as well as in the long term.
However, factors like the life insurer’s increased investment risk in comparison to capital, substantial in-force balance sheet exposure to equity and credit risk associated with its alternative asset portfolio, can offset the ratings affirmation.
Rating affirmations or upgrades from credit rating agencies play an important role in retaining investor confidence as well as in maintaining credit worthiness of a stock. On the other hand, rating downgrades not only damage business but also increase the cost of future debt issuances. We believe that such ratings will help Manulife Financial retain investor confidence and write more businesses going forward.
Zacks Rank and Share Price Movement
Currently, Manulife Financial carries a Zacks Rank #3 (Hold). Shares of Manulife Financial lost 1.18% year to date, significantly underperforming the Zacks categorized Life Insurance industry’s gain of 13.36%. However, we expect Manulife Financial’s sustained operational performance, growing wealth and asset management businesses and robust capital position to help the stock to turn around in the near term.
Health Insurance operates as a developer, distributor, and administrator of cloud-based individual health and family insurance plans, and supplemental products in the United States. The company delivered positive surprises in all of the last four quarters with an average beat of 165.14%.
Torchmark Corporation offers various life and health insurance products, and annuities in the United States, Canada, and New Zealand. The company delivered positive surprises in all of the last four quarters with an average beat of 2.01%.
Fidelity National provides title insurance, and technology and transaction services to the real estate and mortgage industries in the United States. The company delivered positive surprises in three of the last four quarters with an average beat of 8.47%.
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Manulife Financial (MFC) & its Units Get Rated by A.M. Best
Manulife Financial Corporation (MFC - Free Report) and its units recently received rating action from credit rating giant, A.M. Best. The rating agency has affirmed the Long-Term Issuer Credit Ratings (Long-Term ICR) of “a-” and the existing Long-Term Issue Credit Ratings (Long-Term IR) of Manulife Financial.
At the same time, the rating giant affirmed the Financial Strength Rating (FSR) of A+ (Superior) and the Long-Term ICR of “aa-” of the life insurer’s affiliates.
Manulife Financial’s rating affirmation reflects its strong risk-adjusted capitalization, robust liquidity position and solid global business profile in Asia, Canada and the United States. This apart, the ratings indicate the life insurer’s sustained operational performance over the last five years. In addition, the company’s improved scale of core business lines, increased net flows and fee-based revenues, especially within Asia and the global wealth asset management (WAM) business segment, have supported the ratings.
Moreover, the life insurer has been benefited by some of its recent buyouts. Its strategic partnerships in North America and Asia as well as organic growth leading to substantial increases in assets under management and administration raise optimism. Such positives are also represented by the aforementioned ratings affirmation. The credit rating giant strongly believes that these positive rating factors will enable Manulife Financial to improve its growing global market position, particularly the WAM business segment, in the intermediate future as well as in the long term.
However, factors like the life insurer’s increased investment risk in comparison to capital, substantial in-force balance sheet exposure to equity and credit risk associated with its alternative asset portfolio, can offset the ratings affirmation.
Rating affirmations or upgrades from credit rating agencies play an important role in retaining investor confidence as well as in maintaining credit worthiness of a stock. On the other hand, rating downgrades not only damage business but also increase the cost of future debt issuances. We believe that such ratings will help Manulife Financial retain investor confidence and write more businesses going forward.
Zacks Rank and Share Price Movement
Currently, Manulife Financial carries a Zacks Rank #3 (Hold). Shares of Manulife Financial lost 1.18% year to date, significantly underperforming the Zacks categorized Life Insurance industry’s gain of 13.36%. However, we expect Manulife Financial’s sustained operational performance, growing wealth and asset management businesses and robust capital position to help the stock to turn around in the near term.
Stocks to Consider
Some better-ranked stocks from the insurance industry include Health Insurance Innovations, Inc. , Torchmark Corporation and Fidelity National Financial, Inc. (FNF - Free Report) . Each of these stocks holds a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Health Insurance operates as a developer, distributor, and administrator of cloud-based individual health and family insurance plans, and supplemental products in the United States. The company delivered positive surprises in all of the last four quarters with an average beat of 165.14%.
Torchmark Corporation offers various life and health insurance products, and annuities in the United States, Canada, and New Zealand. The company delivered positive surprises in all of the last four quarters with an average beat of 2.01%.
Fidelity National provides title insurance, and technology and transaction services to the real estate and mortgage industries in the United States. The company delivered positive surprises in three of the last four quarters with an average beat of 8.47%.
Looking for Ideas with Even Greater Upside?
Today's investment ideas are short-term, directly based on our proven 1 to 3 month indicator. In addition, I invite you to consider our long-term opportunities. These rare trades look to start fast with strong Zacks Ranks, but carry through with double and triple-digit profit potential. Starting now, you can look inside our home run, value, and stocks under $10 portfolios, plus more. Click here for a peek at this private information >>