Tuesday, June 5, 2007

added more Sun Life

As promised, today when Sun Life financial dipped about 2.5% below where I started my position approximately one month ago, I doubled my position to lower my ACB. For my thoughts on Sun Life see my post in early May. I wouldn't rule out buying more if the stock keeps dropping, however I am satisfied with my current position where my cost is around $50 / share.


Middle Class Millionaire said...

Hi MG,

I've recently been looking at both SLF and MFC as both have become much more reasonably priced in the last month. From a fundamental valuation standpoint both MFC and SLF are almost identical. I think both are great long term holds but I'm just wondering why did you chose SLF over MFC given MFCs reputation as an industry leader?


Trevor said...


I was reading some of your comments on Canadian Business and how you would buy x stock below this price? Could you share how you come up with your target price, or is it too complicated to post about?


Mr. Cheap said...

I was going to ask exactly what Trevor did.

moneygardener (AKA investor99) said...


Fundamentally I see MFC and SLF as quite different. MFC is the stronger company, grows earnings quicker, and earns a higher ROE. The reason I bought SLF recently is because I own Manulife within a DRIP, and buying shares means sending a cheque into CIBC Mellon and hoping the price does not shoot up in the meantime, not an ideal arrangement, and one reason DRIPs aren't ideal for adding to positions.

Also, I feel Sun Life fell more dramatically down to these levels for no reason, and I was impressed with their latest earnings report compared with MFCs. I don't expect as much earnings growth out of SLF, I think I have them pegged at 9% growth per annum, whereas MFC is at 13%. Statiscally MFC has a higher differential according to my models, and therefore is cheaper, however the main reason for this is the difference in growth rates.

Once I began my SLF position, I felt the opportunity to add was too great since it dropped another 2.5%.

SLF is probably viewed as cheaper by the majority of analysts who place all insurers on an equal footing, and look at metrics such as P/E, P/B etc. SLF probably has less of a distance to fall if the environment gets bad, also the higher yield would probably prop it up.


I will post about this in the future.

Thanks for the comments.

CuriousGeorge said...


I can't seem to find the dividend history for Sun Life on their web site. Perhaps it's all the sun I got today and I've just gone blind... Can you please point me in the right direction?

Also, is there a web site that would have dividend payment histories for all Canadian stocks?


moneygardener (AKA investor99) said...


For SLF dividend history:

Investor Relations section / shareholder services / stock information / dividend payments.

As far as a site that lists all dividend histories for Canadian stocks. I wish there was one out there. Stockhouse.ca is decent, but I've had more luck on individual company websites. That's why I like google finance so much, but they need to work on the Canadian content.