Manulife Financial (MFC) Earnings Release Analysis 09 Aug 2023 Post Market

Over the last 2 years, MFC has beaten EPS estimates 75% of the time and has beaten revenue estimates 13% of the time. Market EPS estimate is $0.58 (-26.9% Y/Y) and the consensus Revenue Estimate is $1.44B

Manulife Financial is one of the three dominant life insurers within its domestic Canadian market and possesses rapidly growing operations in the United States and several Asian countries.

With a market cap of $36.6 billion, the stock has an expected earnings growth rate of 2.9% for this year.

In this article, I will be looking at the fundamental data and technical analysis on how Manulife share price have been trading prior to its expected earnings release.

Based on how Manulife has performed in the last quarter, their EPS is slightly below the estimate by 0.01. I would expect that this quarter, EPS to be close to forecast.

Manulife positive outlook could stem from its robust business model that adapts to emerging trends while catering to various clients through multiple distribution channels.

I believe Manulife should be able to match the EPS estimate considering that Manulife has adjusted their business model to cater to the changing demands of the consumers.

While taking advantage of the recent interest rate hike, more consumers should have disposable income to get onto Manulife products and services.

I would be looking closely at the earnings coming from these consumers segment.

Manulife has returned more than 10% YTD. With its robust business model, I believe Manulife should be able to benefit better from higher interest rate hike.

In the event of a rate hike pause, I believe the flexibility of its business model would allow Manulife to focus on segments which would flourish when interest rate is not a contributing factor.

There was an increase of total revenue from Q4 2022 to Q1 2023, but their free cash flow and financing cash flow has been reduced.

This is something that I will be looking for as market has estimate the revenue to be around $1.44B. What would be of concerns is their operating expenses.

Investors have been very negative on Manulife stock recently mainly because there have been volatile trading of ups and downs of its share price since its last quarter results release.

The prices have somehow stabilized this week before its Q2 earnings release. Investors holdings have reduced by 2.4% (last 7 days) followed by 2.6% (last 30 days).

I believe these should improved as a more positive earnings result is expected.

Despite the stock price volatile trading since its Q1 earnings result, Manulife has been in a bull trend.

I believe this bull trend should continue as Manulife is expected to post a better than expected result for Q2 with its robust business model.

Though we have seen some volatile trading since its Q1 earnings release, Manulife did not encountered any sell offs due to overbought.

Now that RSI momentum looks good, I believe investors interest should be coming back strong.

I would expect some buying activities during the pre-market and actual trading today (09 Aug 2023).

ADX is between 20 and 40 which indicate a developing trend, but +DI is too close to -DI which suggest a weak trend but still bullish.

There might be a tendency of moving into a bearish downwards trend if +DI falls below -DI due to a worse than expected earnings result.

I would monitor how the stock would be trading on 09 Aug 2023 and also look at the earnings call on Manulife plan for its business model.

Something worth noting is Manulife has went through a bearish reversal in early August, this might be due to investors not feeling confidence about Manulife future.

There is a short period of bearish movement and this might continue if Manulife post a less than expected earnings result.

Based on what I have observed, Manulife would be able to post a better than expected earnings result due to its robust business model.

But from the investors sentiment, ADX and SAR, there might be a tendency of Manulife trending in the bearish downwards trend if the earnings result posted is less than expected.

Appreciate if you could share your thoughts in the comment section whether you think Manulife could post a less than expected earnings results?

Disclaimer: The analysis and result presented does not recommend or suggest any investing in the said stock. This is purely for Analysis.