Looking at Manulife Financial Corporation performance

http://www.learningmarkets.com/index.php/200912079391/News-Feed/News-Feed/looking-at-manulife-financial-corporation-performance-since-earnings-mfc-ing-axa-lfc.html

=> I guess you can't analyze an insurance company like the following article. It add no value to determine whether an insurance company is worth to invest or not.

Monday, 07 December 2009 05:24
Earnings announcements can make investing tricky. Many investors try to time trades based on earnings releases, but usually find such trading is inconsistent and risky. It is often better to take a look at how the market has reacted to a company’s results a few weeks after the initial announcement.

Manulife Financial Corporation (MFC) delivered its earnings announcement on 11/05. The company reported a change in quarter-over-quarter sales of 136.00% and posted an EPS (trailing twelve months) of - .81.

By now the market has had time to settle in and look closely at the numbers. A stock’s performance in the few weeks following an announcement, compared to other stocks in its industry, the industry as a whole, and market as a whole, really tells you how investors and analysts felt about the announcement.

Compared to the rest of the “Life Insurance” industry

Since the MFC announcement (about 30 days ago), the stock has posted a -10.78% gain (loss). Over that same period, the stock’s industry, Life Insurance, saw a 3.40% gain. That means MFC that has under-performed its industry as a whole 417.06% since the earnings announcement. Small differences aren’t significant, but when the spread is large it indicates the stock is either much more or much less favored than its group as a whole.

Compared to peers

Another way to gauge performance is look at a stock compared to other stocks in its industry with similar market caps. MFC peer ING GROUP NV ADS (ING) has seen a -28.91% stock price gain (loss) over about the last month, while another peer, AXA (AXA) saw a 1.06% gain. So with a return of -10.78%, Manulife Financial Corporation outgained ING and under-performed AXA’s price performance over the last month.

China Life Insurance Co. Ltd. (LFC) is one of the largest stocks in the industry in terms of market cap, and over the same period has returned 10.99% in price.

Compared to the S&P 500 Index

Finally, let’s see how Manulife Financial Corporation stock performance compares to the rest of the market by looking at it compared to the Standard & Poor’s 500 Index (.INX). Since 11/05, the S&P 500 index has returned around 3.4%, and again, MFC saw about a -10.78% gain (loss) during that time. Could be better.

So by putting the returns in context by these comparisons, we can see how a stock’s performance since earnings really measures up and make our investing decisions on MFC accordingly.