Power Corp. Earnings: Great-West Life’s Empower Business Continues to Drive Growth

Power Corp. of Canada reported a decent second quarter, driven by a strong performance of Great-West Life’s Empower business and IGM’s higher assets under management. The firm reported adjusted net earnings of CAD 761 million, or CAD 1.17 per share, in the second quarter compared with CAD 842 million, or CAD 1.26 per share, in the second quarter of the previous year. The company has declared a quarterly dividend of 56.25 cents per share for the second quarter, which represents a 6.2% dividend yield at the current stock price. Power Corp.’s adjusted net asset value per share stood at CAD 50.48 as of the end of the second quarter, which compares with CAD 53.10 at the beginning of the quarter. The company has continued to allocate capital to buybacks given the difference in NAV and share price of the company and has repurchased approximately CAD 189 million of shares in the first half of the year. We are maintaining our CAD 42 fair value estimate for the firm after incorporating the second-quarter results.