Sun Life Financial (SLF.TO)

[funinagg]

what do you guys think of it?
http://www.theglobeandmail.com/globe-investor/markets/stocks/summary/?q=SLF-T
i have too much in cash. index ETF investing is safer (delivers the average) but i prefer to buy ones with better than average future prospects.
i would buy this in the non-registered account and balance it with bond funds in the TFSA.
thanks.

[Financial Cents]

Love SLF. Great company and globally diversified with products and services in Asia.

[cannew]

Unlike MFC, SLF did not cut its dividend during the crisis. It's dividend appears safe and the companies financials are improving.

Good investment in non or registered account.

Remember its not which dividend stock you buy, but when you buy it.

[ddkay]

I've had my eyes on SLF for awhile now. They are a large Canadian company that operates under 5 subsidiaries. SLF revenue overall has been declining since Q3'2010. Fitch reaffirmed their AA- rating today and noted SLF U.S. is not self-sustained at the moment and dependent on some capital support from SLF Canada. Their debt service coverage ratio could be higher, but they believe the dividends are sustainable, "Fitch believes that under Canadian regulations, SLF has greater flexibility to upstream dividends from operating subsidiaries without regulatory approval than most U.S. peers".

In addition to selling health and life insurance they also sell investment products through MFS. SLF U.S. has a lot of exposure to mortgages and "trouble loans" in Canada, U.S. and UK. As well as some exposure to asset-backed securities. These are sensitive to economic recovery and job creation. They are expanding in Asia and the Middle East but those operations are small compared to the established domestic operations. I don't know if I would say this has better than average future prospects just because financials and insurance are the first to get haircuts when the economy falters.

[webber22]

SLF might not have cut its dividend during the crisis, but the stock price is still down 50% from the 2007 levels !!!!! Read the the write-ups on stockchase.com and there are not many recommending it.

[funinagg]

SLF U.S. has a lot of exposure to mortgages and "trouble loans" in Canada, U.S. and UK. As well as some exposure to asset-backed securities. These are sensitive to economic recovery and job creation. They are expanding in Asia and the Middle East but those operations are small compared to the established domestic operations. I don't know if I would say this has better than average future prospects just because financials and insurance are the first to get haircuts when the economy falters.

thanks ddkay. good information. that is what i was/am not clear on. how much the macro economy and the stock market affects SLF. i guess i know the direction but not the magnitude. USA's base demand and China's demand growth are the key factors. and both have big issues.

[Cal]

It has traded between $28-32 for awhile now. So to buy on the low end of that might be reasonable.

Day to day, the share value seems to go with the markets.

I am glad to see that they seem committed to paying the dividend, and not cutting as in the case of MFC.

[Cal]

Remember its not which dividend stock you buy, but when you buy it.

I thought this was funny, as I believe in the opposite. Any time is a great time to buy in to a great company. :)

I am sure we are both right!

[Eder]

SLF might not have cut its dividend during the crisis, but the stock price is still down 50% from the 2007 levels !!!!! Read the the write-ups on stockchase.com and there are not many recommending it.

I think investing or not in SLF (or any other quality equity) based on opinions of analysts is a good way to end up broke.

I don't own this but am beginning to think it's time to get into the insurance business.

[davext]

Not a fan, definitely within a trading range and trades very closely with the market.

I'm going to unload my shares if it gets it about $31.

[Financial Cents]

SLF might not have cut its dividend during the crisis, but the stock price is still down 50% from the 2007 levels !!!!! Read the the write-ups on stockchase.com and there are not many recommending it.

Sure, no stock price appreciation but dividends paid throughout that period. While markets are sideways or down, you're getting paid to be an owner of SLF, currently at $0.36/share I recall.

[KaeJS]

I like SLF. I have an order to buy 100 at $27.75 if it gets there.

It's not something I would hold even though it has a dividend. I would trade it back and forth and use the dividend as my "oh sht, the trading range is gone" backup.

I think with the issues regarding the US and the general market sentiment, i could grab it at 27.75.

But, buying in at $28.xx isnt bad, i just have other stuff on my plate.

[Square Root]

My view: Sleepy company with sleepy management. I do own it but don't love it. Divs OK. Banks have a better business model IMHO.

[ddkay]

Just discovered TMX.com's Top 20 Largest - Consolidated Short Position Report (http://www.tmx.com/en/news_events/exchange_bulletins/short_positions_2011.html)

Surprisingly Sino-Forest hasn't been on the list since May 2011, but SLF is #13 this month: http://www.tmx.com/en/pdf/short_positions/June15-2011.pdf

[webber22]

The TMX short report is pretty much useless I've found. If you back test it, you'll find that each stock has a 50% chance of actually going down in price.

[Square Root]

The TMX short report is pretty much useless I've found. If you back test it, you'll find that each stock has a 50% chance of actually going down in price.

Agree. Most short positions for big well known companies are put on by investment firms to hedge their positions or to facilitate some other deal. They don't have much to do with actual investor sentiment.

[al42]

Oh Oh.

http://www.theglobeandmail.com/globe-investor/news-sources/?date=20111017&archive=prnews&slug=TO985

[ddkay]

I expect layoffs soon, 550m is good for ~4000 people on a 147k salary (what bce is targeting because of a similar amount in increased interest payments and soon maturing debt)

[Jungle]

Might get out of this... another manulife here?

[ddkay]

Opened at 24.90 (-5.68%)

[Jungle]

Just sold all positions at opening bell 24.99 price. Overall gain was about 1%, Held it for a couple months.

[Homerhomer]

Just sold all positions at opening bell 24.99 price. Overall gain was about 1%, Held it for a couple months.

I would say good call, in this environment there is a very good chance you will be able to buy it cheaper in the next 12 months or so, if you so desire.

[HaroldCrump]

Good call, Jungle, IMO.
These things are rarely one-off, usually more bad news follows in the coming days/weeks.
You can always re-buy when it is lower.

[larry81]

a loss of $621 million for the quarter.

wow !

[al42]

Just sold all positions at opening bell 24.99 price. Overall gain was about 1%, Held it for a couple months.

Yup, got stopped out @ 24.95 with a small gain.
Also stopped out of MFC @ 12.75 with a small gain.
Waiting on GWO...Stop set @ 21.7


Update, Got stopped out of GWO @ 21.7.
Correction,My MFC was stopped out at 12.65 not 12.75.
will sit on the sidelines and watch for a while.

[KaeJS]

Wow. That was an unpleasant surprise this morning.

Ugh. To sell or hold? Hm.

I wasn't lucky enough to get out at $25...

[Abha]

What did you buy in at KaeJS?

[KaeJS]

100 @ 25.00. Claimed one dividend of $36.00

If I sell at the current price, that's not bad if you're looking purely at a buy perspective. But it's still a $250 loss if you count the profit.

[Abha]

Sell it asap.

Your losses are minimal.

[Homerhomer]

I am watching both sunlife and great west, in this environment they will both probably be reporting poor earnings over the next year or so, if they don't cut the dividends I will be interested in them at that time, I suspect sunlife will be trading in the teens by then unless there is a very strong support from income investors.

[Cal]

I figure if they were going to cut the divi they would have done it by now. Everyone is aware of the low rate environment that we will be having in the US for the next eyar and a half.

Pretty sure the release anticipated next Q won't be too pretty either.

[Abha]

Well if the macro environment gets really ugly (eu countries defaulting one after another or china's bubble bursting) the dividend would probably be cut 100%

I don't imagine this would happen but its a definite possibility if things don't improve in the near term.

[Jungle]

Insurance companies that sell annuities count on high interest rates and good returns from equity to hold profit.

Manulife had the same problem last year, but their loss was in the billions. They never hedged or any type of plan for this event, market crashing and low interest rates.

Sunlife does out sources it's hedging and does have a reserve fund for this, however things are not going to change over night and as Homerhomer said, expect earnings to be $hit over the next while and that dividend to be slashed, as they need to come up with money now to cover costs and annuity payments to their customers. The stock price will die quite a bit. Kajes, get out.

[KaeJS]

Maybe I'm not exactly getting it --

But sorry, what the hell changed between Q2 and Q3? Just the market decline, that's it? That's going to create a $1B spread?

:confused:

[Abha]

But sorry, what the hell changed between Q2 and Q3? Just the market decline, that's it? That's going to create a $1B spread?

Insurance companies have a lot more to worry about than declining markets. On top of their insurance commitments, they have to worry about rates, spreads and hedging.

Some insurance companies play the rate spreads and lose out big time. I think Sun Life got caught in this during the past couple of months.

Just sell your shares and forget about it. Might as well swap out of Sun Life and into MT

[KaeJS]

Just sell your shares and forget about it. Might as well swap out of Sun Life and into MT

That's currently my thoughts right now. I really want MT at $16.

I just never expected that big of a loss from Sunlife. Sure, I didnt expect a huge profit or anything, I didnt even expect they would pull $300M, but to be down $621? that's awful..

[Abha]

Just be thankful you're not a CROX shareholder.

The shares were decimated after hours.

[KaeJS]

Oh, wow. -35%, that's insane. And I think T.gal was just talking about them..

Oh, well. I guess I will write off SunLife as a good lesson learned. Don't fiddle with insurance co's if markets and rates are poor.

[Toronto.gal]

1. Oh, wow. -35%, that's insane. And I think T.gal was just talking about them..

2. Don't fiddle with insurance co's if markets and rates are poor.

1. Insane indeed & yup, I just was reading last week about their insane [and impressive] success, up to today that is! :eek: Could they possibly go back down to $1.11? Anything is possible with these markets. :rolleyes:

I feel sorry for those who bought today [ahead of earnings], but were not able to exit on time. I learned my lesson with CSCO, never to buy before earnings [at least not in these dizzying times].

2. YTD % of our insurance companies is truly sad. :(

The winner - MFC at - 28%. Then GWO and SLF.

The question becomes when to buy these because the potential upside is there. :confused:

[doctrine]

Sunlife is about half the size of Manulife so this $621M loss is in the billions if you're comparing. It's not an official Q3 report though so have to wait until the final numbers come out. Most financial companies do not write off the value of declining bonds when yields drop (ref: every European bank); so they are being up front and honest. I own and will review their quarterly report before considering buying more. It would probably take a drop to $20 before I buy more (currently have some and not selling). Like it was selling for in '09.

[Sherlock]

I don't understand why you would sell now at a loss? Can't you wait it out? Why turn a paper loss into a real one? It's unlikely to be THAT long before it gets above $25 again and in the meantime you can collect those dividends.

[KaeJS]

doctrine

I am glad you are not selling (yet), as I did not sell today (despite others, and what others have said).

I think I would like to see how it opens tomorrow before making my decision. I definitely, definitely see how this could easily go sour.

Obviously, they made a big mistake and got murdered this Quarter. The dividend is still good, and I don't think it will be cut.

If you've got a few years, there's no way you can't get out at today's current price down the line.

But what you need to ask yourself is - if they are warning of a bad quarter, are they warning because the 621M loss is really a 750M loss when it comes out in paper in 2 weeks?

[KaeJS]

I don't understand why you would sell now at a loss? Can't you wait it out? Why turn a paper loss into a real one? It's unlikely to be THAT long before it gets above $25 again and in the meantime you can collect those dividends.

Yes.

But I see what everyone is saying.

SLF just paid a dividend...

You could sell now and buy back at $20, without even missing a single dividend....

[HaroldCrump]

One of the first lessons I learnt when I started investing on my own is that bad news never comes alone...it likes company.
One piece of bad news is followed by another, and often yet another.

And by the time all the bad news is flushed out, it's almost time for the next earnings season, and guess what kind of news that brings.

With large, complex, diversified corporations like these insurance giants, it can take a long time to flush out all the bad stuff.

[Argonaut]

KaeJS, your portfolio is somewhat similar to mine, but I never liked your choice of SunLife. The volatility during the last three years has given us a gift, to see which companies have held their own during financial uproar. Insurance companies are not on this list. Looking at your portfolio, I would replace SunLife with your favourite utility (FTS, EMA, CU). I would also replace your least favourite of SU or CPG with a Mickey D's or something. These are just my personal choices and may not fit into your plan.

[KaeJS]

^ I sold MCD at $77 like a fool. Still turned a profit, but what a waste compared to today's prices.

We will see how badly SLF opens tomorrow, which I suspect will probably be badly. If that's the case, I will probably sell and switch to 100 shares of MT, and leave some cash on the table..

I don't get upset/angry with the market often. But today, SLF kinda put me in a rough mood this morning.

[Homerhomer]

, expect earnings to be $hit over the next while and that dividend to be slashed, as they need to come up with money now to cover costs and annuity payments to their customers. .

My guess job cuts and premium increases will be the first to be implemented, dividend cut will be the last resort and they will do anything possible to avoid it. If they do cut the dividends this thing may be in single digits.

[KaeJS]

Out at $23.91.

It was actually up at $24.10 on a small bounce, but my order didn't make that cut.

[KaeJS]

$24.50?

You've got to be kidding me...

I think I just got my first gray hairs.

[kcowan]

He believes that a charge of a similar nature for MFC would be 2-3 times the size of SLF’s charge.Wow! This is the "lifetime" impact to annuities for SLF: 650 million this quarter and another 500 million next quarter. Price has been recovering since 10:30am. What do they buyers know?

[Toronto.gal]

You said it yesterday KaeJS, the markets are 'insane'.

I don't know if you had bought SLF for long term, if not, not sure why you would have picked a stock in the mid $20's and an insurance company of all when there are many others for much less, if what you wanted had been a quick profit. :confused:

[Homerhomer]

Price has been recovering since 10:30am. What do they buyers know?

IMO this is a typical dead cat bounce after horrid drop; huge drop-bit of recovery followed by a slide (remains to be seen but I would bet all your money on it ;-)

[Abha]

$24.50?

Just forget about it. The best thing you can do for yourself is to move on from your old trades and to focus entirely on the new ones.

[KaeJS]

T.Gal,

I did purchase SLF for the long term. But after seeing what happened to MFC, and seeing as how there's some miraculous $1B spread between quarters, along with interest rates and the ruined economy...

My thinking is/was "why not get in at a lower price before the next dividend"?

T.Gal, I guess what I was trying to do was make short term trades in a long term position? :D

Can someone else explain to me why they would announce an estimate? What is the purpose? What is the value and in who's favour is this?

Is it so they can say "Hey, we THINK we lost 621M" and then when the numbers are actually posted, they only lost 500M, or is it the other way around and they will end up posting a 750M loss?

[phrenk]

MFC's loss will be proportionally much smaller than SLF since they started a hedging program for the past 4 quarters for both their equity and interest rate exposures. I would not be surprised if it went up to 13.50$ in the next month.

[KaeJS]

^ I am pretty sure SLF hedges, as well.

[doctrine]

It's not exactly new news that bond yields are low and markets are down. Either you believe SLF is going to survive or not. If so, buy/hold. If not, sell now and stay away. No one knows if the price will be higher in 3 months or a year. Markets and yields are already up from 30 Sep (when Q3 ended) so this might be the low. Or not. Hope that helps.

[Toronto.gal]

T.Gal, I guess what I was trying to do was make short term trades in a long term position? :D

I know it's not easy handling this market volatility & you're right, who can forget what happened to MFC. :rolleyes:

Also, everyone is wondering/waiting to see what will happen on Oct.23rd before committing greater capital.

I had thought you were trading SLF and in that case, the cheaper MFC is better to trade at only $12+ as opposed to $25.

Don't feel bad, just focus now on recovering the losses.

[gibor]

Don't feel bad, just focus now on recovering the losses.
This is the biggest question how to recover the losses :rolleyes:

P.S. Luckily I didn't have SLF or MFC, but have enough losses...

[Abha]

Don't even put that thought in your head.

Just focus on making money.

The more you concentrate on losses and bad trades, the more emotional you get and that ruins future trades.

You're likely to make bolder and riskier bets to try to make back what you lost and make more on top of it.

[Toronto.gal]

This is the biggest question how to recover the losses :rolleyes:

P.S. Luckily I didn't have SLF or MFC, but have enough losses...

No need to rolleyes, what you need is a plan of action & to take advantage of volatility!

I have MFC shares and was down quite a bit on my initial purchase & prior to averaging down, but I recovered my paper losses by day/swing trading that same & other decimated stocks when they reached clear bottoms [$10+, $11, $12 seemed bottom to me].

In this yoyo market, for the experienced investor/trader, it has been practically impossible not to have made profit trading. This stock is the one that bothered me the most as it was my biggest loser and also because I have a high number of shares, hence a high capital, but by now, I also get a high number of free shares every quarter with the dividends.

The accumulation of free shares via drips is bound to pay off several years down the road as I figure by then [if company does not go under & I don't think it will], I will have several hundred free shares. The problem with having a so called 'dog stock' is mostly a dilemma only if there are no dividends/low dividends, not enough shares or stock does not recover.

[Homerhomer]

I had thought you were trading SLF and in that case, the cheaper MFC is better to trade at only $12+ as opposed to $25.

Don't feel bad, just focus now on recovering the losses.

Tgal, I usually agree with your posts, but I don't understand why MFC would be a better trade just because it trades at half the price? Apple can be a good trading stock, I personally don't care how many shares a set amount can buy, I only care about percentage gain.

As for other advise :) given to our friend Kaej, I totally agree, don't dwell on the mistakes, learn from them and move on.

[Homerhomer]

No need to rolleyes, what you need is a plan of action & to take advantage of volatility!

.

Absolutely, much better than crying and whining about it.

For me, even though I don't trade nearly as often as Tgal, nor my profits from that are nearly as good, it kept me in the green for the year.

I am pretty risk averse within the equity market, all my trading blocks are only made up of stock I wouldn't mind holding for a long time in case I mess up the trade, so far I have messed up 3 times this year with SU, CSCO and ENC and I continue to hold them, I have made probably 20-25 other trades which more than made up for that and the general weakness of the market.

[Toronto.gal]

Apple can be a good trading stock, I personally don't care how many shares a set amount can buy, I only care about percentage gain.

Simple:

1) don't like to tie-up too much capital if intent is day-trading as there is no guarantee of a quick exit and,

2) I like high volume of shares as that way I can exit much quicker with as little as .5 cents profit & on occasion, even trade the same stock twice in one day [$.5 cents x 5000 shares = $250 & that is good enough for me for a few hours of tying my capital].

I don't really pay attention to % when trading [only when calculating returns], but rather, I look at the $ amount. If I invest $5K and can make $200 on it or even $100 in a day [sometimes in less than an hour], I take it! Could you put $5K in the bank today and withdraw $5,100 at the end of the day, or $5,086.10 if counting commissions? :p By the time you add all the small trades one can make in a month, the % gained is reasonable.

I have made some of my best profits with small capital & with shares under $5; it has worked for me, but granted that we don't all have same trading styles/techniques.

As we say, 'different strokes for different folks', or as you would say, 'just make some goddamn money'. :D

[al42]

$24.50?

You've got to be kidding me...

I think I just got my first gray hairs.

Down close to 2.5% so far today...best just to sit on the sidelines and watch this one. It will probably get hammered again when they report even though they pre announced the huge Q3 lost. That is just the way the market is trading these days.

[humble_pie]

" The problem with having a so called 'dog stock' is mostly a dilemma only if there are no dividends/low dividends, not enough shares or stock does not recover.

another problem is owning a dog that's dropped below cost & then another company buys it for a price per share that's *still* below cost ...

anybody w a high cost base who's still in RIM is exposed to this risk ...

[daddybigbucks]

Simple:

1) don't like to tie-up too much capital if intent is day-trading as there is no guarantee of a quick exit and,

2) I like high volume of shares as that way I can exit much quicker with as little as .5 cents profit & on occasion, even trade the same stock twice in one day [$.5 cents x 5000 shares = $250 & that is good enough for me for a few hours of tying my capital].

I don't really pay attention to % when trading [only when calculating returns], but rather, I look at the $ amount. If I invest $5K and can make $200 on it or even $100 in a day [sometimes in less than an hour], I take it! Could you put $5K in the bank today and withdraw $5,100 at the end of the day, or $5,086.10 if counting commissions? :p By the time you add all the small trades one can make in a month, the % gained is reasonable.

I have made some of my best profits with small capital & with shares under $5; it has worked for me, but granted that we don't all have same trading styles/techniques.

As we say, 'different strokes for different folks', or as you would say, 'just make some goddamn money'. :D

toronto.gal --are you ever going to write a financial book?

not that i agree with everything you post but really seem to have a good handle on things.

[gibor]

No need to rolleyes, what you need is a plan of action & to take advantage of volatility!



I'd like "take advantage of volatility", but so far volatility is taking advantage of me :(
Market now is pure gambling (I'd say even much worsde than casino), and I'm not a good gambler.

[gibor]

One of my problem that i really started to buy equities only this year... and it was awful timing, if I'd start 2-3 years ago - situation would be different... much easier to risk gains, than to risk when you're in losses....
It's like in blackjack or rouletta....when i played online for free -> i usually win, when in real life -> i usually lose.

[marina628]

Toronto Gal ,can i send you $5000 of my money for you to play with ?:)

[KaeJS]

Market now is pure gambling (I'd say even much worsde than casino), and I'm not a good gambler.

Market is a lot easier than a casino.

The Market just takes some practice and patience.

[gibor]

Market is a lot easier than a casino.

The Market just takes some practice and patience.

I wouldn't say so... In blackjack depends on the table rules , there are specific rules for your actions. There are no pre-game , after-game (like premarket and aftermarket) where all your bets (stop limits) can get by-passed, nobody can short, table doesn't care about newspaper articles like situation in Greece is sux and so on and ... nobody changing the rules during the game. ;)

[gibor]

Toronto Gal ,can i send you $5000 of my money for you to play with ?:)

I want it too...I want it too :) .. and we'll share profit and losses....;)

[Homerhomer]

I wouldn't say so... ;)

Try identifying the companies you can hold for long term, see if they have trading pattern and go with it, if you are wrong you own a good company, if you are right you make 10-30% per trade.

Look at goldcorp, how many times you could have traded the stock in the 45-46 to buy and 50-53 to sell range this year? Will it continue in the future, perhaps not, but I can tell you that many are buying it around 45 creating support, and dumping it around 50 creating a ceiling.

Just identify few stock and watch them.

[KaeJS]

but gibor, blackjack is all in the luck of the cards.

You could double up and get throwed. You could hold at an 18 and get punk'd be the dealer.

I got blackjack at a casino once. Dealt right to me. Dealer had the same thing. It's all in luck, even if you follow the rules.

But with the market, you have options. Not only do you have options, but if you make a mistake, you can just "buy and hold" if you think it will come back.

And unlike blackjack where 21 wins, even -21 wins in the market ;)

[KaeJS]

Look at goldcorp, how many times you could have traded the stock in the 45-46 to buy and 50-53 to sell range this year? Will it continue in the future, perhaps not, but I can tell you that many are buying it around 45 creating support, and dumping it around 50 creating a ceiling.

Just identify few stock and watch them.

This.

At the slot machine, the slot tells YOU what you get.

[Toronto.gal]

1. toronto.gal --are you ever going to write a financial book?

2. not that i agree with everything you post but really seem to have a good handle on things.

1. Maybe when I'll retire daddybigbucks. :D Thanks for the compliment.

2. I would like to hear your opinion when you don't agree. I have also disagreed with some here at first, only to realize that they had been right in some instances.

[Toronto.gal]

I'd like "take advantage of volatility", but so far volatility is taking advantage of me :(

That happens to all of us, but there have been opportunities as well, plenty of them!

If you only started buying stocks in 2011, no wonder you're having a hard time, feeling manipulated by volatility & calling the stock market casino, lol. As KaeJS said, you need experience & patience, no getting around that I'm afraid.

Have you heard the saying 'In theory there is no difference between theory and practice. In practice there is? I started in Oct./2009, so I'm in my 2nd year now & the experience in 1st year definitely helped a lot in 2nd year & the same will be for you.

Gibor: sorry but my 'practice' is full for 2011/2012; might have openings in 2013 though, assuming of course, that we're all still around after Dec.21st/2012 [or is it 23rd]. :p

Marina: let's make a deal, I give you some money to play for me in the casino and you give me winnings of both to invest. :D

I hope you're watching Dragon's Den, ROFL, apparently Kevin is full of sh1t. :D

[marina628]

I have been more active in last 4 years with individual stocks ,before that i was just buying mutual funds and GIC .I do not watch Dragon's Den much , watched risky business this week , is it me or is Brett getting more attractive as he ages lol

[gibor]

Gibor: sorry but my 'practice' is full for 2011/2012; might have openings in 2013 though, assuming of course, that we're all still around after Dec.21st/2012 [or is it 23rd]. :p



Maybe some personal training?! ;)

[Toronto.gal]

LOL; like your Russian humour Gibor. :D

[King Tut]

Market now is pure gambling (I'd say even much worse than casino), and I'm not a good gambler.

Gibor, IMHO, there is one main difference between the market and the casino in that the longer you stay in the casino, the more certain it is that you will lose your money. With the market, and if you've bought at the right price (value investing), you are more likely to win! Right now SLF is trading @$23.80, below book value. I see it as a bargain if you plan to leave your money for at least a year. In the mean time, their yield is 6%!!!!!!!

[Abha]

In the mean time, their yield is 6%!!!!!!!

Don't bank on that yield just yet. There's always a chance that the market and interests rate spreads might force Sunlife to lower or temporarily discontinue their dividend payments.

[gibor]

Gibor, IMHO, there is one main difference between the market and the casino in that the longer you stay in the casino, the more certain it is that you will lose your money.
It's correct for example for rouletta, but wrong for blackjack. If you count cards and play according to strategy, more you play, more likely you to win

[King Tut]

Don't bank on that yield just yet. There's always a chance that the market and interests rate spreads might force Sunlife to lower or temporarily discontinue their dividend payments.

I see your point, but if history is any indication, check their dividends over time, it has been on the rise since at least 2000:

http://www.sunlife.com/slfglobal/v/index.jsp?vgnextoid=9c33c6369e3bc110VgnVCM1000009c 80d09fRCRD&vgnLocale=en_CA

[Toronto.gal]

I wouldn't argue with King Tut; could prove to be dangerous [if you believe in the curse of King Tut]. :p

If the worst of them all [MFC] cut the dividends by 1/2, I don't think SLF would do worse & dividend would still be reasonable at $.18/Q

[KaeJS]

SLF will never get rid of the dividend completely, and I don't think they will even cut the distribution.

But I still think it will go below $23.

[dubmac]

I bought SLF is 2009 - held it since & continue to drip it. When the price dropped, I realised that to sell is to take a loss. I don't need the $ right now, ..so why panic & sell? Even if the dividend drops, I expect interest rates will (eventually) go up (insurnace companies do better in those conditions, am I right?), and the price should follow. For the long-term investor, why sell?

[KaeJS]

Because people can make money elsewhere.

I sold it, bought MT and G.TO and made more profit.

And if I want, I can buy it back at only $0.22 higher than I sold it for without missing a single dividend payment.

[rassmy]

SunLife is a dead money for the next 18 month. With the market correction we had this summer, if you sell SLF even with losses and put the money in other stock/sector you can get 5% yield with potential capital gain. So I sold my half position at 26.40 and the second half at 24.10.

[Financial Cents]

Still over $3 B. in cash.

I continue to DRIP SLF. What is the worst case scenario? Goes to $20? $18? $15? I continue to DRIP and get stock cheaply. Works for me :)

[KaeJS]

Nothing wrong with dripping SLF at all, it is just a more passive approach and opportunities can be missed.

[Toronto.gal]

I continue to DRIP MFC. :p

It's alright because I have several shares, so the dividend buys me enough free shares to make me forget about this company, but if it wasn't for that, I would put the money to work elsewhere for sure!

[dubmac]

Still over $3 B. in cash.

I continue to DRIP SLF. What is the worst case scenario? Goes to $20? $18? $15? I continue to DRIP and get stock cheaply. Works for me :)

I'm with you Cents..in a few months, I may pick up another 100 sh if it drops into teens..average down the cost.

I see your point KaeJS as well...I see other opportunities, but I don't see the need to take the loss on SLF if I don't need to

Interesting choice on Goldcorp KaeJS...could well be a nice place to park some $ now.

[Financial Cents]

I continue to DRIP MFC. :p

It's alright because I have several shares, so the dividend buys me enough free shares to make me forget about this company, but if it wasn't for that, I would put the money to work elsewhere for sure!

I hear ya. I don't need the money for income yet, so DRIPping works for me. Stocks for free.

[KaeJS]

Interesting choice on Goldcorp KaeJS...could well be a nice place to park some $ now.

Only 50 shares for now.

and 50 more down the road if I am wrong. :D

Don't worry dubmac and FC, I will join you guys in the SLF party again. :)

[doctrine]

I'm holding. Can't predict the future, on this stock or others. If you believe in 5 years that the stock price could be at ~$25, then you merely take your 6% a year in dividends and you're up 30%. Not bad, and better than inflation.

[gibor]

Interesting choice on Goldcorp KaeJS...could well be a nice place to park some $ now.
I'm kinda dissapontent now...Gold is sharply up, and G is slightly down :confused:

[KaeJS]

G.TO should be up $3 in a matter of weeks.

That's how it always goes.

[dubmac]

Wow..right you were KaeJS...Goldcorp is on a tear! nice call ;)

[KaeJS]

Thank you ;)

It went up faster than I thought! :D

[King Tut]

I see SLF on a roll :) apparently the whole market is on a roll today.... let's hope it stays this way................ that is, at least for a while:)

[KaeJS]

Remember they release their final numbers next week for the quarter...

Could be interesting.

[fernandes90]

so would this be the best time to invest and drip?

[KaeJS]

in my opinion - no.

What happens if their loss ends up being more than $621M like they said it would be? Then the stock is going to tank.

And more than likely, if they've lost $621M this quarter, they will lose money again next quarter.

I want to buy this stock back at $23... I cant buy it in the $25 range.

[KaeJS]

To be honest, I am hoping they post a bigger loss than $621M so I can buy back in :p

[fernandes90]

So I should just wait for them to report a gain/loss. I wouldn't mind a loss either that way I can purchase more shares and it would be easier to drip. I'll just be on the sidelines for now till I hear otherwise

[KaeJS]

Well, we already know they are going to post a loss, because they announced it about 10 days ago, however, it was only an estimate.

The real numbers will be posted on November 3 at 10am.

If their loss is worse than $621M like they estimated, get ready for a drop in price.

[Toronto.gal]

If their loss is worse than $621M like they estimated, get ready for a drop in price.

Thank goodness I only bought 1 'resident dog' [I had considered MLF/SLF at one point]. But long term, say in another 10 years, who do you think will be on top?

[Spudd]

I can just say that I work for a huge multinational corporation, and we use SunLife for our benefits. As a user I've been very happy with them.

[Toronto.gal]

Group insurance plans are not anti-selective & benefits offered are the same for all employees, though most [if not all], do offer flexibility with HSA accounts & lets the employee select the benefit level/premium that is right for him/her [if plan is contributory, ie: premiums are shared with employer]. Also, the standard turnaround time for claim reimbursement is pretty much the same with all companies, but like in any business, service sometimes may not be the same, in fact, when companies switch insurance companies [which can be complicated to do], do so more for poor service reasons than increase in premiums.

The benefits offered to you, have more to do with the employer & what premiums they are willing to pay & not so much the insurance company as most offer similar coverage.

Glad that you're happy with Sun Life coverage [if not the stock]. :)

I like their commercials btw [though Clarica used to be the best in clarity/humour]. :D

http://cdn.sunlife.com/static/canada/sunlifeCA/pa_e_fall_ad_banner_1.jpg

[Jungle]

Ok so q3 was released, dividend not cut. We already know the loss. HOWEVER
now they are saying the q4 net income is going to be down $550-$650 because of of re-evaluating variable annuities and segregated funds? :confused:

[fernandes90]

So would it be a good time to invest first thing in the morning?

[KaeJS]

Ok so q3 was released, dividend not cut. We already know the loss. HOWEVER
now they are saying the q4 net income is going to be down $550-$650 because of of re-evaluating variable annuities and segregated funds? :confused:

.... Don't want to be rude.... :(

But that was a given... :o

I refuse to buy until the market pics up and their Q4 is over with.

[Argonaut]

Why bother meddling with a company losing money? I never saw the appeal of value investing in the sense of buying out of favour companies. Value investing to me means buying good companies when the market gives a general discount. SunLife deserves a roster spot on the Chicago Bears, not the Bulls.

[Jungle]

That's why I sold out, but I am keeping an eye on their progress.

[Homerhomer]

It would be interesting to see how Great West manages the turmoil and which company comes out the best in a year or two once they go through an extended period of low interest rates and possibly more market turmoil.

Manulife is a dog, Sunlife looks just as bad although they haven't cut the dividends yet, Great West may be the best option, time will tell.

I am not touching insurance companies at least for another few months if not longer, but I am watching to see which once manage it better.


Manulife just reported 1.3B loss, ouch.

[Toronto.gal]

IMO, GWO is the BNS of insurers for its conservative nature, however, not as much upside as the other 2 once interest rates rise & markets recover.

MFC's loss looks good comparing to the 2.25 billion a year ago.

Given interest rates and their exposure to equity markets, their losses are not surprising.

[Homerhomer]

IMO, GWO is the BNS of insurers for its conservative nature, however, not as much upside as the other 2 once interest rates rise & markets recover.

.

If I were to buy them for a long term hold portion of my portfolio I would be fine with steady and boring ;-), let's see how they report Q3 but so far they are making money each year (there may be a quarter where they lost money, but those are few and far between), paying out less then they make, increased dividends each year until 2008 and have not cut the dividends. If the conditions continue as they are their share price may reflect it even if they manage to bring in a profit, yield on purchase may then exceed 7%. They may just be best of breed ;-)

[Homerhomer]

MFC's loss looks good comparing to the 2.25 billion a year ago.

.

Lol, yes it's all relative, it looks great if you compare it to something even worse:)

[Toronto.gal]

Not great, but loss is 43% less, hence a huge improvement! Every cloud has a silver lining & we have to maintain a sense of humour. :D

[KaeJS]

SLF under $23.

Whoops. :)

[Toronto.gal]

If I were to buy them for a long term hold portion of my portfolio I would be fine with steady and boring ;-)

For balance we need such stocks in our LT portfolio, however, I would not mind making 40% short term on the side as well, like I did with MFC for example when I purchased around $11 and shortly thereafter, they were around $17. Then the profits can go to the steady & boring stocks. :cool:

[Homerhomer]

$24.50?

You've got to be kidding me...

I think I just got my first gray hairs.

Selling it when you did doesn't look so bad now, does it :)

Buy it back when it hits 15 or so, if you still want to own it :eek:

[Jungle]

AIG just posted a 4.1 billion dollar loss.. what is going to become of these insurance companies? This is not a small amount of money here..

SLF closes at $22.85.

[Argonaut]

what is going to become of these insurance companies? This is not a small amount of money here..
They need to get some insurance. :o

[doctrine]

http://www.theglobeandmail.com/globe-investor/how-a-canadian-address-turned-manulifes-22-billion-profit-into-a-128-billion-loss/article2223793/

Just to put it in perspective, and why I'm not really worried about my MFC or SLF stocks.

[KaeJS]

Selling it when you did doesn't look so bad now, does it :)

Buy it back when it hits 15 or so, if you still want to own it :eek:

Nope. :)

I'd buy at $15 for sure.

[Jungle]

Barclays says fundamentally, they can not recommend this stock now. Target prices have been cut to $23.

[HaroldCrump]

Barclays says fundamentally, they can not recommend this stock now. Target prices have been cut to $23.Barclays would do well to worry about their own stock first.

As for cutting price target, gee thanks, I wonder what we would have done without their insightful and in depth analysis.

Wonder where they were 1 year ago? :rolleyes:
Oh right, funding terrorists and rebels in sub-Saharan Africa.

[Jungle]

=http://www.theglobeandmail.com/globe-investor/how-a-canadian-address-turned-manulifes-22-billion-profit-into-a-128-billion-loss/article2223793/

Just to put it in perspective, and why I'm not really worried about my MFC or SLF stocks.


Very interesting article, thank you for that. I did not know they use different accounting measures.

I've also learned that insurance companies are very hard to measure and judge. All these professional analysis were not expecting this to happen to SLF. However we all know the current market risks do affect them.

[ddkay]

Howard Green (BNN) asked Manulife CEO Guloien whether they would move their company HQ to the US, he responded saying the board is open to that option.

[doctrine]

Looks like I'm going to buy some SLF in the near future. Hoping to get around $22 but we'll see. This is primary re-balancing; it's dropped below my target % in my portfolio and I still like it, therefore I will be rebalancing into weakness.

[King Tut]

I am loading up on SLF... I think it is a bargain price at $22.16

[Jungle]

Be careful; they said there will be another 500-600 million decline in net earnings for q4, due to a one time write down on how they evaluate annuities. Read page two of this report:

http://www.sunlife.com/static/global/files/News%20Releases%202011%20PDFs/pa_e_Sun_Life_Financial_reports_third_quarter_2011 _results_Nov2.pdf

The dividend pay out ratio might be negative.

[marina628]

This has been on my watch list a while but I definitely have no plans to buy until after Q4 results are in.

[King Tut]

This has been on my watch list a while but I definitely have no plans to buy until after Q4 results are in.

But you may miss the boat if you wait too long

[Homerhomer]

But you may miss the boat if you wait too long

Better to miss the boat than get on it before it sinks :)

There are lot's of boats around:D

[Toronto.gal]

1. Better to miss the boat than get on it before it sinks :)
2. There are lot's of boats around:D

1. This is no joke, so yes, be careful & don't rush!
2. Indeed. LOL. :D

[King Tut]

Better to miss the boat than get on it before it sinks :)


Do you really think SLF is a sinking boat? Why? I am talking long term here.

[KaeJS]

It is a boat with a hole that needs to be fixed quickly, as the ocean waters are getting rough and less forgiving. With each wave, that hole gets a little bigger and the boat starts to fill up with a little more water.

As a recent shareholder, (and I'll admit, a recent shareholder that did not understand insurance co's business too well) I have educated myself more on SLF and also on the insurance industry.

I think its safe to say that Long-Term, SLF will be okay. But short term, you want to GTFO.

They are losing money. The more money they lose, the more strain it will put on the nice, shiny, $0.36/q dividend. This is the number one thing to keep in mind.

[Toronto.gal]

They are losing money. The more money they lose, the more strain it will put on the nice, shiny, $0.36/q dividend. This is the number one thing to keep in mind.

Agree!

And if the dividend were to be reduced, what do you think would happen to the share price? Just as a reminder to what happened to MFC:

http://www.cbc.ca/news/business/story/2009/08/06/manulife-dividend-earnings.html

SLF may not cut the dividend & may be in better shape, however, volatility is still high and interest rates are low, so I wouldn't pile up just yet, but if you don't want to wait, buy in tranches.

[Jungle]

Dividend pay out is now 17% higher than EPS.. according to google:

http://www.google.ca/finance?client=ig&q=TSE:SLF (google can be off)

Hint: Dividend pay out is supposed to be under earnings per share. ;) Above 70% is considered high risk. This is at like 117% above eps, if my math is right.

Another loss in q4 and EPS will magnify this. Not sure what their cash flow is like, to sustain dividend, after another loss.

[doctrine]

Yes, they're going under. Sell sell sell :-)

[Homerhomer]

Do you really think SLF is a sinking boat? Why? I am talking long term here.

At this moment there is very little upside and plenty of downside, given low interest rates and the market conditions they will have a hard time making any profit in the next 2 years, investors realize that and are very cautious, give it couple more quarters like the last one ( we already know q4 will be bad due to $500M hedging costs) and the dividends are in danger, I don't see poeple flocking into the stock, quite the opposite, some may be selling in anticipation of dividend cut, and if that happens many will sell after it's cut.

IMO there is absolutely no need to rush into buying this stock, long term I would be surprised if there aren't better buying opportunities to buy in within the next 2 years or so, the chart looks awful with no support insight, but the company is quite unlikely to go under.

I am watching Great West with interest to see how they are able to manage, not likely to buy it any time soon either, but they may be a better option if one is looking for steady company with good yield.

[Navigate Sensibly]

What's up with SLF cutting US dividend by 1% and Canadian dividend stays the same? What is up with that? Because of the conversion rate? :confused:

Well, I do want to sell, but then I don't want to at the same time cuz it's in my registered account and I will have no capital loss tax credit. :mad:

Didn't they say they are looking at a better Q4 b/c of increasing equity markets in October?

[al42]

Sunlife issuing 250 million of pref. shares.

http://pr-canada.net/index.php?option=com_content&task=view&id=465652&Itemid=55

[KaeJS]

:rolleyes:

[King Tut]

Sunlife issuing 250 million of pref. shares.

http://pr-canada.net/index.php?option=com_content&task=view&id=465652&Itemid=55

Not a good sign... I also don't like that their retained earnings are sitting at zero, down from $6.8 Billion in Q1

[daddybigbucks]

Part of me wants to sell, the other part of me wants to hold.

Usually negative news snowballs.

[King Tut]

Part of me wants to sell, the other part of me wants to hold.


I would not sell if I were you, unless if you need the money that is. I think it is a matter of time, and it will rebound within a year.

[ddkay]

Are interest rates going up next year?

[daddybigbucks]

I would not sell if I were you, unless if you need the money that is. I think it is a matter of time, and it will rebound within a year.

I compromised...i sold half.
I just think they will cut the dividend. I dont know what the AOCF of Sunlife is, but i seen this same scenerio play out with SPB.

They have a bad quarter and they CEO goes on record saying it is just a one off thing. Then they muddle through the next quarter and keep saying it is going to get better while paying dividneds that they can't pay.

I'm just going to take some money off the table and wait. Maybe look at MFC to see how they are doing.

[doctrine]

I bought some SLF today. Maybe I bought yours :-) We'll see how it turns out.

Also King Tut, their quarterly report had $6.5B in retained earnings on 30 Sep.

[Homerhomer]

Great West earnings are pretty good, profit inline with expectations. They seem to be doing better than the other two.

[rassmy]

If I decided to buy inssurance companies today, I will buy great west (GWO) or Power financial (PWF), very conservative companies and both are sitting on very good amount of cash.

[Cal]

Looks like the market is pricing in a dividend cut, or another large loss next Q.

Next Q results might be very interesting.

Could pick some up for under 20 soon...

[daddybigbucks]

Looks like the market is pricing in a dividend cut, or another large loss next Q.

Next Q results might be very interesting.

Could pick some up for under 20 soon...

I agree.
ill probably buy back in right before next quarterly if they get some good news happening.



I bought some SLF today. Maybe I bought yours :-)
still smiling doctrine?
I'm sure SLF will be good for long term but might be painful in short term.

[doctrine]

Yep, in fact if it hits $20 I'll pick up some more.

[Cal]

MIght be able to get some under $19....

[Jungle]

Wow this stock is down 28% since I sold it. Me finding this thread before markets open and selling for tiny profit was all luck.

Over the past couple years, I watched everyone buy MFC in the 30's and catch the falling knife all the way down to $11, where it currently sits.

This really made me question our investment strategy of buying stocks. Our overall portfolio is already performing poor (I know the benchmark is down 21% now) but holding this one would have killed it, being down 28% now.

If luck saved a large loss here, I don't like that kind of investing. I was thinking about selling all stocks and moving to index funds. No research, no stress.

Right now, we are about 25% stocks, rest are index funds.

[marina628]

Never been interested in any insurance companies , guess I see too many disasters on CNN to want to own a part of that.

[KaeJS]

MIght be able to get some under $19....

'till you can get 'em for under $18. :D

[Homerhomer]

Never been interested in any insurance companies , guess I see too many disasters on CNN to want to own a part of that.

I think there is something to be said about that, however on the other hand everybody needs insurance, and just about everything is insured and the main factor in the dismay of the insurers, at the least the Canadian once are the market conditions and mismanagement. I think when the markets settle, and the interest rates raise (when it happens I have not idea but eventually it will), you may have an opportunity to pick up a good insurer with 10% yield on cost and potentially good growth upside.

When the rates will start raising is the question, is it in 2 years or 12 ;-)

[Homerhomer]

MIght be able to get some under $19....

Already at $19, IMO still way to early to get in if at all.

[al42]

Already at $19, IMO still way to early to get in if at all.


I have a buy order in @ $18.75....Has not hit yet.

[daddybigbucks]

Dividend yield is around 7% presently.

If the stock price doesnt rise soon, a dividend cut may be in the works.

[KaeJS]

What does the stock price rising and a dividend cut have anything to do with each other?

A dividend is based off of cash flow.

If the dividend is cut, it won't be because the stock is getting hammered, it will be because they are posting losses, such as their 621M loss last quarter.

To cut the dividend because the stock is getting hammered would be like shooting the stock in the foot.

[al42]

What does the stock price rising and a dividend cut have anything to do with each other?

A dividend is based off of cash flow.

If the dividend is cut, it won't be because the stock is getting hammered, it will be because they are posting losses, such as their 621M loss last quarter.

To cut the dividend because the stock is getting hammered would be like shooting the stock in the foot.

I read somewhere that,if not meet, the new minimum capital requirements could force a dividend cut . This could be the problem.

[kcowan]

If you are happily collecting a 7% dividend while the company posts successive large losses, be prepared to be disappointed.

[Toronto.gal]

To cut the dividend because the stock is getting hammered would be like shooting the stock in the foot.

They might cut the dividend to retain more of their earnings [even when that move would punish the stock further]. With much higher risk/volatility now and predicted future lower profits, SLF could in fact follow MFC's example.

Current yield is too high.

[daddybigbucks]

.

Current yield is too high.

yep. A high yield for a large cap such as SLF is a huge warning sign.

[Homerhomer]

They might cut the dividend to retain more of their earnings [even when that move would punish the stock further]. With much higher risk/volatility now and predicted future lower profits, SLF could in fact follow MFC's example.

Current yield is too high.

I agree, that's why in dividend investing one should never be lured by yield alone.

The problem with Sunlife is that unless they turn it around and quickly, eventually they will have to cut the dividends, and for them the near term future (ei next 2 years) looks bleak.

[Homerhomer]

yep. A high yield for a large cap such as SLF is a huge warning sign.

Yield for Great West is around 6.2, not much lower than Sunlife yet they had to work with similar difficult circumstances, says something about the management. Great West, unless something changes, can easily sustain the dividend since the current payour ratio is around 70%, higher than I would like but given the circumstances pretty good number, yet the stock will get punish with other dogs in the industry.

While I agree that high yield is a warning sign, it is also an opporunity to pick a diamond in a rough.

[daddybigbucks]

Yield for Great West is around 6.2, not much lower than Sunlife yet they had to work with similar difficult circumstances, says something about the management. Great West, unless something changes, can easily sustain the dividend since the current payour ratio is around 70%, higher than I would like but given the circumstances pretty good number, yet the stock will get punish with other dogs in the industry.

While I agree that high yield is a warning sign, it is also an opporunity to pick a diamond in a rough.

I just went through a similiar circumstances with Superior Plus.
SPB had a payout ratio of 95% of AOCF in 2010 and they said they were ok with that, but they would like to get it more in the 80% ratio.

The company just floundered. Now they are saying they want payout at 45%.

I usually buy dividend stocks because they can cut the dividend to increase the companies cash flow. Usually it is to get through tough times then it gets reinstated. I have no problem with that.

It usually the big fat cats at the top of the company that want to wring every cent out of the company, because everything is short term for them.

[OptsyEagle]

What does the stock price rising and a dividend cut have anything to do with each other?

A dividend is based off of cash flow.

If the dividend is cut, it won't be because the stock is getting hammered, it will be because they are posting losses, such as their 621M loss last quarter.

To cut the dividend because the stock is getting hammered would be like shooting the stock in the foot.

I tend to find with companies who require equity capital to operate, like SLF, that as soon as the market stops propping up the stock with the dividend, management usually decides to cut it, and retain the money.

There are exceptions, but that is the norm that I have seen.

[doctrine]

It would be better to cut the dividend for a year or two than to issue new equity.

[kcowan]

Yes except that new issues are invisible gradual dilution whereas a dividend cut can trigger a sell-off.

[Homerhomer]

Both are bad, or should I say rarely positive.

[Toronto.gal]

Agree, but proper management of dividend payments is important, so I think dividend cuts would be more favourable.

[OptsyEagle]

http://www.theglobeandmail.com/globe-investor/investment-ideas/streetwise/sun-life-to-cut-dividend/article2251861/

[balk]

I am torn between adding to my position and selling what I currently have.

With this kind of downturn, shouldn't future interest rate risk be starting to get baked into the stock price?

I did sell a quarter of my position at $23

[dubmac]

I am torn between adding to my position and selling what I currently have.


I am in a similar frame of mind balk...still wondering whether to sell...a losing...stock.

[KaeJS]

'till you can get 'em for under $18. :D

:rolleyes:

[KaeJS]

I am torn between adding to my position and selling what I currently have.

Torn between buying more or selling it all?

Why don't you just hold it and wait it out?

It seems like SLF won't cut the dividend, at least not for another few months, from the articles and quotes I have read from the board of D's.

There is at least another $0.36/share dividend payment coming. So just wait?

:confused:

Although, it could end up like RIM and fall forever - slowly, to its death.

But, I thinking buying more is definitely out of the question..

After all, isn't stock trading about risk mitigation? Where is the mitigation of risk in buying more SLF? That's an increase in risk.

[Homerhomer]

Quite possibly the next support level may be around $15 (March 09 level), but if they cut the dividends or dilute the shares then watch out, single digits here they come.

For the next 6 months or so I don't see any catalysts that would move the shares much higher unless they can pull a rabbit out of the hat and surprise with earnings, but you know what they say, buy when doom and gloom and nobody wants to touch it with a 10 foot pole, so ....... ;-)

With that said this company is off my watch list, it doesn't belong in the best of breed anymore.

[balk]

Torn between buying more or selling it all?

Why don't you just hold it and wait it out?

It seems like SLF won't cut the dividend, at least not for another few months, from the articles and quotes I have read from the board of D's.

There is at least another $0.36/share dividend payment coming. So just wait?

:confused:

Although, it could end up like RIM and fall forever - slowly, to its death.

But, I thinking buying more is definitely out of the question..

After all, isn't stock trading about risk mitigation? Where is the mitigation of risk in buying more SLF? That's an increase in risk.

I was saying how I feel - the appearance of a buying opportunity vs cutting my losses. Realistically, I won't add to this position because it was a big enough (albeit falling) position in my portfolio to begin with. It does seem like times like these is an opportunity to buy companies at good value, it is just holding on for the ride after you purchase it.

[al42]

http://www.therecord.com/news/business/article/632483--sun-life-cuts-40-jobs-in-waterloo-and-kitchener

[Cal]

I guess we will know for sure in a couple of weeks, but the market appears to be pricing in a loss, perhaps a divi cut.

[PMREdmonton]

I would like to buy SLF but will wait until after they cut the dividend as their will be a large loss at that time.

The life insurance market is really beat up right now. I think the rates eventually rebound and the insurers will pop but it will require patience on the buy side.

[Jungle]

Breaking news on sunlife:

Cutting 800 jobs in US.
Exiting variable annuity business in US
Dividend is not changed.. (for now)

Buyer beware..

[Uranium101]

another beating coming lol.

man, why can't those Europeans work together? And what is the purpose of the ECB if they can't be the lender of last resort?
Why can't they issue Euro bonds since they have using the same currency?
I mean, I could just go to Greece and earn 25% on their bonds and spend them in Germany. Same money, same value.

[kcowan]

Stay away from Lifecos!

[Toronto.gal]

Recent news were welcomed by shareholders however! Stock is up by almost 3%, but I would not touch it at this time.

[Homerhomer]

Recent news were welcomed by shareholders however! Stock is up by almost 3%, but I would not touch it at this time.

I agree.

[daddybigbucks]

its going to be an interesting stock to watch till next earnings.

[CanadianCapitalist]

The insurers are beaten up quite a bit. SLF, for example, has a *tangible* BV of $16. One would think that insurance would be a better bet than banks over the next 10 years.

[Square Root]

The insurers are beaten up quite a bit. SLF, for example, has a *tangible* BV of $16. One would think that insurance would be a better bet than banks over the next 10 years.

i would bet on banks rather than insurers. The banks' business model is much more robust based on their retail deposi gathering. insurers have a much longer duration balance sheet and don't earn nearly as high ROE's as banks. Insurers are way too dependent on favourable equity markets and interest rates. I sold my insurance co's a couple of months ago buying ENB.

[kcowan]

Everyone is saying DB Pensions are no longer affordable. Lifecos are stuck with annuities.

[Cal]

http://www.theglobeandmail.com/globe-investor/news-sources/?date=20111212&archive=cnw&slug=C5845

[Financial Cents]

SLF and others will soon be selling PRPPs (Pooled Registered Pension Plans).

The money will eventually flow again.

[HaroldCrump]

SLF and others will soon be selling PRPPs (Pooled Registered Pension Plans).

The money will eventually flow again.You think so?
I have my doubts about the PRPPs.
I think they will have a cool response, if any at all.
People have had enough of mutual funds.
There is investor fatigue in general.

[Financial Cents]

No doubt lifecos. have been hit hard. Probably will be for some time, but PRPPs will help some folks and lifecos. will benefit.

Not all lifecos. are going under. Maybe some dividend cuts, some mergers in the years ahead.

[Cal]

On the other hand, it may be a good time to load up, prior to interest rates rising in a year or two.

I don't see a dividend cut for SLF at the end of this month, but we will have to see what 2012 holds...

[Homerhomer]

On the other hand, it may be a good time to load up, prior to interest rates rising in a year or two.

...

I agree, may be a good time to load up on lifecos and trim utilities, however with government interventions the rates may not go up for a while, that's the biggest unknown imo.

[Cal]

True, as ENB has been on an absolute tear lately, I have been wondering who is pouring all of their investment $ into it prior to the eventual rise in interest rates. Nice to ride the wave though.

And the insurers will eventually get a boost by rise in rates. When who knows.

[dubmac]

when is the next earnings report for SLF? I sold some recently & plan to buy back on the assumption that news is bad - but I want to hold an (insurance) co in my pf. I suspect that the next 6 months will determine whether they cut the divvie or not

[Square Root]

I have really gone cold on insurance co's. i don't understand their financials and I'm not sure management is too sharpe either. Not saying they are going under but if the business model is so complicated that transparency suffers, I go somewhere else. I lost quite a bit on SLF and MFC so maybe my view is biased.

[Homerhomer]

I have really gone cold on insurance co's. i don't understand their financials and I'm not sure management is too sharpe either. Not saying they are going under but if the business model is so complicated that transparency suffers, I go somewhere else. I lost quite a bit on SLF and MFC so maybe my view is biased.

Sorry to hear that, agree that their f/s are impossible to read but that was always the case, however I look at the beat down sector offering products everyone needs and can't help but feel that there is a value there, the companies have undeperformed for many years now, 60-70% down in the last 5 years for the two you were suffering with, one has to think that eventually there may be a good value and time to get back in (maybe not these two but some other insurance cos). Time will tell.

[Square Root]

Sorry to hear that, agree that their f/s are impossible to read but that was always the case, however I look at the beat down sector offering products everyone needs and can't help but feel that there is a value there, the companies have undeperformed for many years now, 60-70% down in the last 5 years for the two you were suffering with, one has to think that eventually there may be a good value and time to get back in (maybe not these two but some other insurance cos). Time will tell.

I lost around 1/2 of one % of portfolio on these guys so no big deal. They have only been public co's since 2000, so not much of a track record. I just understand the banks so much better so will stick with them.

[Financial Cents]

Probably a good time to be buying more SLF, MFC and GWO I think.

Sector has been beaten up and dividends are still coming. I suspect we'll see a divi. cut by SLF in 2012. Yield is way too high.

If and when the haircut comes, price will rise and you're already in the game. The need for insurance is not going anywhere anytime soon.

[brocko]

I have been hearing about the guy who controls 14% of the CPR and his demands for a leadership change in the company. This has me wondering who are the dominant shareholders of Sun and Manu? It just seems to me that management of these companies reporting to their boards of course run the operations getting rich themselves while the companies falter. Manu had their change in leadership and now Sun has their new guy following Stewart's gold and platinum retirement. Any one know?

[daddybigbucks]

Last five days are looking very strong for SLF.

its very suprising as analysts are still cutting targets.

[KaeJS]

^ Temporary.

Wait until they post their next $621M loss and cut the dividend.

[Cal]

Well they did just pass the Q, and no dividend cut anouncement. We will have to wait another 3 months to see.

With rumors that there may be 2 quarter point rate increases here in Canada later in the year, it may be that the insurers feel the end of the storm is near.

[KaeJS]

With rumors that there may be 2 quarter point rate increases here in Canada later in the year, it may be that the insurers feel the end of the storm is near.

These are just rumours, after all....

People were saying rates were going to go up a couple months ago.

I think there is still some shtstorm left for the insurers

[Toronto.gal]

I think there is still some shtstorm left for the insurers

I would agree.

An MFC shareholder like me, is in no rush to get SLF [yet], though I will, if and when the div. is cut/reduced [after that, not before]. If not, I'm sure there will be plenty of chances to get in; this time I'm in no rush for anything and plan to mostly trade.

I learned many lessons from 2010 and 2011 that I don't wish to repeat same mistakes in the 'paranormal' year 2012. :p

I think there might be M&A activity in this area.

[dubmac]

T-gal,
what price would you consider buying SLF? - I reduced my holding and want to buy back when it drops - probably a mugs game to establish how low it could go - but I'm hoping for 15-16 range.

[doctrine]

SLF looked like it was going to break $18 but now it's pushing $20. I made a buy at $18.99 so I'm pleased. ACB--

[praire_guy]

Why buy after the dividend cut? SLF is already priced for a dividend cut.

[Toronto.gal]

T-gal, what price would you consider buying SLF? - I reduced my holding and want to buy back when it drops - probably a mugs game to establish how low it could go - but I'm hoping for 15-16 range.

Is anyone's guess, but to answer your question, I would buy in the low teens; a bit lower than you, hoping for $13/14. ;)

[Toronto.gal]

Why buy after the dividend cut? SLF is already priced for a dividend cut.

I would partially agree, but do you really believe the stock would not be further punished following an official dividend cut announcement? I could see it going down 10%/20%, but then again, I may be biased and/or traumatized given my experience with MFC. :)

On Nov. 2nd, prior to SLF's earnings release, the stock was around $24 and about 17% less 2 weeks later, but the stock went down not just due to its own earnings reports, but for reasons that were punishing other stocks as well, so it's hard to say how much it has lost directly as the result of the potential dividend cut rumour.

[Homerhomer]

With rumors that there may be 2 quarter point rate increases here in Canada later in the year, it may be that the insurers feel the end of the storm is near.

Job numbers in Canada are pretty bad (in comparison to IMO inflated US numbers), and have been pretty bad for the last 6 months, this doesn't bode well for rate increases. Time will tell but we had these rumours for the last 2 years.

[Homerhomer]

Why buy after the dividend cut? SLF is already priced for a dividend cut.

Sunlife is priced in for possibility of dividend cut, but not the cut itself, if they do cut there will be a significant additional haricut.

[blin10]

Sunlife is priced in for possibility of dividend cut, but not the cut itself, if they do cut there will be a significant additional haricut.

if anything it might go up if they cut divi, I saw it happen many times with other companies...

[Toronto.gal]

Could you offer an example blin10?

In some cases, I can see that shareholders would welcome the idea of a dividend cut, but not so sure about SLF given interest rate reasons and other factors that are affecting such companies.

[Homerhomer]

For every time the shares went up after the cut there is 10 companies that went drastically down.

We don't have to look far to see what happens with a beat down stock that cut dividends, how about manulife ;-)

http://www.cbc.ca/news/business/story/2009/08/06/manulife-dividend-earnings.html

15% down the day after the cut, and downhill ever since ;-)

Dividend cuts are rarely sign of a turn around, each one of us has their own investment philosphies, I for one avoid companies who can potentially cut the dividends, and don't invest companie who cut them recently, I prefer dividend growth.

[KaeJS]

Why buy after the dividend cut? SLF is already priced for a dividend cut.

This is a no-no.

The main problem is not the dividend. The main problem is interest rates and the economy.

A decrease in dividend, translated to shareholders is:

"Oh, yeah, we are getting screwed and losing lots of money..."

[Toronto.gal]

1. there is 10 companies that went drastically down.
2. how about manulife ;-)
3. 15% down the day after the cut, and downhill ever since.

1. are [since you jumped on the spelling bandwagon]. :D
I agree with the comment.

2. Can't blame people for preferring to have short-term memory; don't we all after Aug. 2011? :p

3. That's how I deduced SLF might drop 10% to 20% in such event.

[Toronto.gal]

The main problem is not the dividend. The main problem is interest rates and the economy.[/I]

You're wise! :cool:

[Homerhomer]

Thanks Tgal but I never jumped on a spelling and grammar bandwagon, I believe trying to come to understanding different bandwagons would be a fruitless excercise ;-), especially in a Sun Life thread :p

[Toronto.gal]

I'm just in a funny mood 2day Homerhomer. ;)

[HaroldCrump]

First we had quote police, now we have spelling and grammar policing, too.
This is becoming North Korea.
Time to head over to the ban the user thread.

[Toronto.gal]

You're not talking about me I hope. :(

SLF wanting to get to $20, so I'm not buying it.

[HaroldCrump]

You're not talking about me I hope.Are you referring to my post above?
This non quoting dictate is making it difficult to figure out who's talking to who about what :o

[Toronto.gal]

I was writing to the person above me [thinking you were calling me the grammar police], hence no quoting was necessary Mr. Bogart. :)

[underemployedactor]

Just to get back on track here (re dividend cut being priced into SP etc) the reason I took a flyer on SLF is on the expectation that they will eventually have to give some kind of guidance. If they announce a cut, then the SP will be punished, although I think not too harshly (10%). If they give guidance that no div cut is imminent then I say it bounces 25%. I cite BMO 2009 as a model - divvy yield went up to 9% everybody squaked that a cut was imminent, when management finally said no divvy cut, SP shot up like it was fired out of a bazooka.

[KaeJS]

^ Fine. Agreed.

However, the biggest part of making money and keeping it in the stock markets is to watch your risk.

You're taking a risky bet. It could pay off. It might not.

Better opportunities out there. That's all.

[underemployedactor]

Risk = reward. Surely that's axiomatic.
Managing risk is a sane response to an insane investing world:D

[doctrine]

I have no illusions that this stock is going to drop 20%+ if they drop the dividend. It might take 5 years to recover. If they don't, it could rise 50% in a year or two, especially if interest rates start going up in 2013. It's hard to say, so I'm keeping it at a low % of my overall portfolio, but don't mind owning a little. ENB is more than making up the difference for me and I'm still collecting dividends on both.

[Cal]

Since the last post, a bit of a bump in share value....can only wonder if that is part of the market rally or a little faith from teh market that the divi will not be cut.

[PMREdmonton]

Since the last post, a bit of a bump in share value....can only wonder if that is part of the market rally or a little faith from teh market that the divi will not be cut.

I think it was just following the market. Insurance companies invest part of their float in the market so when the market is doing well it bumps up their earnings. So I think that's why it has been running up over the last month or so.

The thing that has been killing the life cos is the low interest rates make it hard for them to earn anything on bond investments. The Feds announcement that rates will stay low until late 2014 (or almost 3 more years) is responsible for the fall in shares over the last day, IMO.

[Cal]

http://www.theglobeandmail.com/globe-investor/investment-ideas/features/at-the-bell/little-to-bank-on-with-insurance-industry-stocks-analysts-predict/article2327255/

Applicable to all insurers, I just posted it in the SLF thread as it was currently the highest.

[kcowan]

$2 billion in shorts! Yikes!

[Square Root]

Just to get back on track here (re dividend cut being priced into SP etc) the reason I took a flyer on SLF is on the expectation that they will eventually have to give some kind of guidance. If they announce a cut, then the SP will be punished, although I think not too harshly (10%). If they give guidance that no div cut is imminent then I say it bounces 25%. I cite BMO 2009 as a model - divvy yield went up to 9% everybody squaked that a cut was imminent, when management finally said no divvy cut, SP shot up like it was fired out of a bazooka.

Companies never give guidance re a dividend cut. They usually have a dividend payout target which you can use to project future dividends. They usually respond to dividend questions " we have no current plans to cut the dividend" When you think about it, it would be pretty stupid to announce a dividend cut in the future without actually cutting it now?

[Financial Cents]

A dividend cut has to happen at some point, yield is way too high.

[Square Root]

A dividend cut has to happen at some point, yield is way too high.

If price doesn't rebound (like banks in 2009) you are probably right. BMO hit about 10% in Feb, 2009.

[dubmac]

I sold a portion of SLF a few months ago - (& took a loss), on the expectation that a dividend cut was looming. I have been watching this stock to re-purchase shares when the dividend cut is announced.

Given the challenging times for SLF, low growth, low rates env., would many out there buy SLF if / when the cut is announced (and the price drops)?

[Jesse]

Aren't insurance companies being held down primarily by low rates? Aren't rates at all time lows?

If SLF lowers the div and the price drops 15%, it would make a new 52wk low and the price would have nowhere to go but up once rates begin to climb.

[PMREdmonton]

The life insurers may be dead money for a long time in this low rate environment. Fed has said rates will be very low until late 2014. That means it will be 2.5 more years of very slim interest rate returns for them.

My guess is the time to get back in is spring 2014 or so as the money will begin to come back in and move the stock up in anticipation of a better rate environment.

I'd much rather buy banks which can still make some money off net interest rate margins or even the mortgage REITs. CIM may do very well if the employment picture improves.