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Reasons Why You Should Hold Sun Life Financial (SLF) Stock

Reasons Why You Should Hold Sun Life Financial (SLF) Stock

Sun Life Financial SLF is riding on strong foothold in Asia, expanding global asset management and a solid financial position. The company currently carries an impressive VGM Score of B. Here V stands for Value, G for Growth and M for Momentum, with the score being a weighted combination of all three factors.

Return on equity of 13.8% in the trailing 12 months was better than the industry average of 11.4%, reflecting the company’s efficiency in utilizing shareholders’ funds. It estimates generating underlying ROE of 12-14% over the medium term.

Why Hold is an Apt Strategy?

This Zacks Rank #3 (Hold) life insurer expects to witness underlying earnings per share rise of 8-10% per annum over the medium term. The expected long-term earnings growth is pegged at 9%, higher than the industry average of 5.5%. It has a favorable Growth Score of B. This style score analyzes the growth prospects of the company.

The third largest insurer in Canada remains focused on the emerging economies that are expected to provide higher return than the North American markets. Continuous strategic investments in Asia are in tandem with its growth strategy. It is shifting focus toward products that park lower capital and offer more predictable earnings. Aiming a spot within top five players, the company is growing its voluntary benefits business.

Sun Life is aggressively trying to boost its Global Asset Management Business, which has been witnessing a rise in asset base for the past quarters.  The company currently has $1.1 trillion worth of assets under management.

Acquisitions have been an important part of the company’s growth strategy. It acquired a majority stake in InfraRed Capital Partners to broaden management suite of alternative investment solutions. It is also contemplating to acquire Crescent Capital Group, the $28-billion worth credit manager, per sources. This

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3 Reasons to Bet on Pinnacle Financial (PNFP) Stock Now

3 Reasons to Bet on Pinnacle Financial (PNFP) Stock Now

Despite the continued concerns related to the pandemic and low rates, it seems to be a wise idea to add Pinnacle Financial Partners, Inc. PNFP stock to your portfolio now. The bank boasts solid fundamental and prospects.

Also, the stock has been witnessing upward earnings estimate revisions of late, reflecting analysts’ optimism regarding its earnings growth potential. The Zacks Consensus Estimate for its current-year earnings has been revised 1.5% upward over the past seven days, while that for the next year has been raised 3.1%. It currently carries a Zacks Rank #2 (Buy).

However, shares of the company have gained 8% over the past three months, underperforming the industry’s rally of 15.7%.

Here are a few factors that make Pinnacle Financial stock an attractive pick now.

Earnings Growth: The company witnessed earnings growth of 17.1% in the past three to five years, higher than the industry average of 13.7%. While its earnings are projected to decline 26.3% in 2020, the trend will likely reverse after that. In 2021, earnings are expected to grow 17.8%.

Revenue Strength: Pinnacle Financial’s revenues witnessed a compounded annual growth rate (CAGR) of 40.5% over the last five years (2015-2019). The uptrend in revenues is expected to continue in the near term as reflected by the company’s projected sales growth rate of 7.4% for the current year and 1.1% for the next year.

Favorable Valuation: The company seems to be trading at a discount with respect to its price/book (P/B) and price/earnings (P/E) (F1) ratios. Currently, it has a P/B ratio of 0.65, which is below the industry average of 0.77. Likewise, its P/E (F1) ratio of 11.30 is lower than the industry average of 12.31.

Also, the stock has a Value Score of B. Our research shows that stocks with a Value Score of A

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