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Here's Why Investors Should Bet on Sun Life (SLF) Stock Now
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Sun Life Financial (SLF - Free Report) has been favored by investors on the back of its focus on Asia operation, growing asset management businesses, favorable growth estimates and a strong financial position.
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, the average being 3.98%.
Zacks Rank & Price Performance
SLF currently carries a Zacks Rank #2 (Buy). Over the past year, the stock has gained 7% compared with the industry’s rise of 14.6%.
Image Source: Zacks Investment Research
Optimistic Growth Projections
The Zacks Consensus Estimate for Sun Life’s 2024 earnings is pegged at $5.02 per share, suggesting growth of 8.94% year over year. The expected long-term earnings growth rate is 8%.
Business Tailwinds
Sun Life stays focused on continually strengthening its presence in the Asia market, which provides higher returns and growth than the North American markets. The contribution of Asia to SLF’s earnings has increased to 21% from 8% over the last few years.
The life insurer is improving its business mix and thus shifting its growth focus toward products that park 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. The company is also increasing its spending on growth initiatives.
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. Asset management provides a higher return on equity, lower capital, and volatility, and has the potential for an earnings upside.
SLF also invests in the private credit domain, which ensures a greater yield, thus creating an opportunity to generate higher income.
Banking on operational expertise, Sun Life has built a strong capital position. It targets a leverage ratio of 25% over the long term. The life insurer’s capital outlay includes a 40-50% dividend payout over the medium term. Given the company’s ongoing shift to fee-based capital-light businesses, it reiterated its medium-term return on equity target of 18%.
Sun Life has an impressive Value Score of A, reflecting an attractive valuation of the stock.
Other Stocks to Consider
Some other top-ranked stocks from the insurance industry are Reinsurance Group of America (RGA - Free Report) , Manulife Financial Corp. (MFC - Free Report) and Primerica, Inc. (PRI - Free Report) . While Reinsurance Group sports a Zacks Rank #1 (Strong Buy), Manulife Financial and Primerica carry a Zacks Rank #2 each at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Reinsurance Group beat estimates in three of the last four quarters and missed in one, the average being 18.81%. In the past year, shares of RGA have gained 14.2%.
The Zacks Consensus Estimate for RGA’s 2024 earnings per share has moved up 0.6% in the past 30 days.
Manulife Financial has a solid track record of beating earnings estimates in each of the last four quarters, the average being 6.66%. In the past year, shares of MFC have risen 15%.
The Zacks Consensus Estimate for MFC’s 2024 earnings per share is pegged at $2.65, indicating a year-over-year increase of 8.2%.
Primerica has a solid track record of beating earnings estimates in each of the last four quarters, the average being 7.84%. In the past year, shares of PRI have gained 41.6%.
The Zacks Consensus Estimate for PRI’s 2024 earnings per share is pegged at $17.61, indicating an increase of 9.9% year over year.
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Here's Why Investors Should Bet on Sun Life (SLF) Stock Now
Sun Life Financial (SLF - Free Report) has been favored by investors on the back of its focus on Asia operation, growing asset management businesses, favorable growth estimates and a strong financial position.
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, the average being 3.98%.
Zacks Rank & Price Performance
SLF currently carries a Zacks Rank #2 (Buy). Over the past year, the stock has gained 7% compared with the industry’s rise of 14.6%.
Image Source: Zacks Investment Research
Optimistic Growth Projections
The Zacks Consensus Estimate for Sun Life’s 2024 earnings is pegged at $5.02 per share, suggesting growth of 8.94% year over year. The expected long-term earnings growth rate is 8%.
Business Tailwinds
Sun Life stays focused on continually strengthening its presence in the Asia market, which provides higher returns and growth than the North American markets. The contribution of Asia to SLF’s earnings has increased to 21% from 8% over the last few years.
The life insurer is improving its business mix and thus shifting its growth focus toward products that park 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. The company is also increasing its spending on growth initiatives.
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. Asset management provides a higher return on equity, lower capital, and volatility, and has the potential for an earnings upside.
SLF also invests in the private credit domain, which ensures a greater yield, thus creating an opportunity to generate higher income.
Banking on operational expertise, Sun Life has built a strong capital position. It targets a leverage ratio of 25% over the long term. The life insurer’s capital outlay includes a 40-50% dividend payout over the medium term. Given the company’s ongoing shift to fee-based capital-light businesses, it reiterated its medium-term return on equity target of 18%.
Sun Life has an impressive Value Score of A, reflecting an attractive valuation of the stock.
Other Stocks to Consider
Some other top-ranked stocks from the insurance industry are Reinsurance Group of America (RGA - Free Report) , Manulife Financial Corp. (MFC - Free Report) and Primerica, Inc. (PRI - Free Report) . While Reinsurance Group sports a Zacks Rank #1 (Strong Buy), Manulife Financial and Primerica carry a Zacks Rank #2 each at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Reinsurance Group beat estimates in three of the last four quarters and missed in one, the average being 18.81%. In the past year, shares of RGA have gained 14.2%.
The Zacks Consensus Estimate for RGA’s 2024 earnings per share has moved up 0.6% in the past 30 days.
Manulife Financial has a solid track record of beating earnings estimates in each of the last four quarters, the average being 6.66%. In the past year, shares of MFC have risen 15%.
The Zacks Consensus Estimate for MFC’s 2024 earnings per share is pegged at $2.65, indicating a year-over-year increase of 8.2%.
Primerica has a solid track record of beating earnings estimates in each of the last four quarters, the average being 7.84%. In the past year, shares of PRI have gained 41.6%.
The Zacks Consensus Estimate for PRI’s 2024 earnings per share is pegged at $17.61, indicating an increase of 9.9% year over year.