Rising Rates Are Positive for Life Insurers in the Long Run; Relaunching Manulife at CAD 27.50 FVE

We are relaunching Manulife Financial with a fair value estimate of CAD 27.50 per share after taking a fresh look at it. Our fair value estimate implies that Manulife is slightly undervalued at the current prices. Manulife provides a variety of financial services products, including life insurance, annuities, and investment management products mainly in the U.S., Canada, and Asia. The investment management business of the company has achieved adequate scale and is a source of stable earnings and sustained cash flows. We assign a no-moat rating, a stable moat trend, and a standard capital allocation rating to the company.