Morningstar

Power Corporation of Canada Shs Subord.Voting POW

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Stock XTSE Rating as of
CAD 42.52 −0.14 (0.33%)
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As of Delayed Price Closed

Company Report

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Power Corp's Biggest Holding, Great-West, Starts the Year Strong; Increasing Fair Value Estimate

Suryansh Sharma

Power Corporation of Canada is a holding company and derives most of its underlying value from its ownership stakes in no-moat Great-West Life and narrow-moat IGM Financial. We estimate that Power Corporation's stake in two publicly listed companies accounts for approximately 85% of its overall value. The company has stated that rather than diversifying across industries, Power Corp. will focus on the financial services sector. The company simplified its ownership structure and reduced corporate costs after it acquired all the shares of Power Financial in a restructuring effort in 2020.

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Price vs Fair Value

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POW is trading at a 235% premium.
Price
CAD 42.66
Fair Value
CAD 24.00
Uncertainty
Medium
1-Star Price
CAD 31.60
5-Star Price
CAD 34.20
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

Power Corporation's key holding of Great-West Life produces the best returns among the large Canada life insurers, driven by its expense management and strong underwriting.

Bears

Great-West Life offers a wide range of complex insurance products that exposes it to underwriting, investment, capital market, and interest-rate risks thereby making it difficult to predict the company’s overall risk exposure, especially during periods of economic turbulence.

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News

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Trading Information

Previous Close Price
CAD 42.66
Day Range
CAD 42.23–42.67
52-Week Range
CAD 32.33–43.53
Bid/Ask
CAD 42.48 / CAD 42.61
Market Cap
CAD 27.52 Bil
Volume/Avg
8.5 Mil / 2.9 Mil

Key Statistics

Price/Earnings (Normalized)
9.08
Price/Sales
0.78
Dividend Yield (Trailing)
5.19%
Dividend Yield (Forward)
5.27%
Total Yield
5.19%

Company Profile

Power Corporation of Canada is a holding company with controlling interests in Great-West Life (an insurance conglomerate), IGM Financial (Canada's largest nonbank asset manager), and other alternative asset-management platforms (Sagard and Power Sustainable). The company also has minority interests in Groupe Bruxelles Lambert (a holding company with interests in European companies) and ChinaAMC (an asset manager in China).
Sector
Financial Services
Industry
Insurance - Life
Stock Style Box
Large Value
Total Number of Employees
40,300
Website
https://www.powercorporation.com

Competitors

Valuation

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Metric
POW
SLF
MFC
Price/Earnings (Normalized)
 9.0812.1110.85
Price/Book Value
 2.221.911.69
Price/Sales
 0.781.191.68
Price/Cash Flow
 2.6929.9617.95
Price/Earnings
POW
SLF
MFC

Financial Strength

Metric
POW
SLF
MFC
Quick Ratio
 ———
Current Ratio
 ———
Interest Coverage
 7.898.124.58
Quick Ratio
No chart available

Profitability

Metric
POW
SLF
MFC
Return on Assets (Normalized)
 0.62%1.15%0.78%
Return on Equity (Normalized)
 38.83%16.42%16.60%
Return on Invested Capital (Normalized)
 8.42%12.67%9.80%
Return on Assets
POW
SLF
MFC

Insurance - Life Industry Comparables

Screen With Investor
1-Day Chart
Name
Price
Morningstar Rating for Stocks
Capital Allocation
Economic Moat
Market Cap
China Life Insurance Co Ltd Class H
CILJF
—Gzwl$145.6 Bil
 Ping An Insurance (Group) Co. of China Ltd Class H
PIAIF
XrpztfhzxLxjw$135.7 Bil
 Ping An Insurance (Group) Co. of China Ltd ADR
PNGAY
—Shhr$135.7 Bil
 AIA Group Ltd ADR
AAGIY
—Gpsjv$97.6 Bil
 AIA Group Ltd
AAIGF
—Swgyt$97.6 Bil
 Aflac Inc
AFL
WvslkycsDcdgjc$62.6 Bil
 MetLife Inc
MET
TptyrhmxHvbc$57.8 Bil
 Manulife Financial Corp
MFC
LnphfscrGlfx$52.4 Bil
 Prudential Financial Inc
PRU
VjwllwczqHkys$43.2 Bil
 Prudential PLC ADR
PUK
JtgwdkjjzCrpn$25.0 Bil

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