Yahoo Finance What Does The Future Hold For Manulife Financial Corporation (TSE:MFC)? These Analysts Have Been Cutting Their Estimates
The latest analyst coverage could presage a bad day for Manulife Financial Corporation (TSE:MFC), with the analysts making across-the-board cuts to their statutory estimates that might leave shareholders a little shell-shocked. This report focused on revenue estimates, and it looks as though the consensus view of the business has become substantially more conservative.
After the downgrade, the ten analysts covering Manulife Financial are now predicting revenues of CA$53b in 2024. If met, this would reflect a sizeable 84% improvement in sales compared to the last 12 months. Per-share earnings are expected to bounce 23% to CA$3.07. Previously, the analysts had been modelling revenues of CA$53b and earnings per share (EPS) of CA$3.13 in 2024. The forecasts seem to have become a little more negative on the business after the recent consensus updates, given the small dip in their earnings per share forecasts for this year.
Check out our latest analysis for Manulife Financial
The consensus price target held steady at CA$38.25, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future.
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. One thing stands out from these estimates, which is that Manulife Financial is forecast to grow faster in the future than it has in the past, with revenues expected to display 240% annualised growth until the end of 2024. If achieved, this would be a much better result than the 25% annual decline over the past five years. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 8.2% annually. Not only are Manulife Financial's revenues expected to improve, it seems that the analysts are also expecting it to grow faster than the wider industry.
The Bottom Line
The biggest issue in the new estimates is that analysts have reduced their earnings per share estimates, suggesting business headwinds lay ahead for Manulife Financial. Fortunately, analysts also reconfirmed their revenue estimates, suggesting sales are tracking in line with expectations - and our data does suggest that Manulife Financial's revenues are expected to perform better than the wider market. Often, one downgrade can set off a daisy-chain of cuts, especially if an industry is in decline. So we wouldn't be surprised if the market became a lot more cautious on Manulife Financial after today.
Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. At Simply Wall St, we have a full range of analyst estimates for Manulife Financial going out to 2026, and you can see them free on our platform here.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
