The weakening Canadian economy has investors wondering if they should put new money into the banks or look for another financial company that offers decent yield while limiting some of the domestic risks.

Let’s take a look at Sun Life Financial Inc. (TSX:SLF)(NYSE:SLF) to see if it fits the bill.

Earnings strength

Sun Life delivered Q2 2015 earnings of $726 million, or $1.18 per share, a 49% increase over the same period last year.

Operating ROE rose to 16.5% from 12.6%, and the company’s assets under management increased to $808 billion compared with $684 billion in the second quarter of 2014.

Sun Life is seeing strong growth in both its wealth management and insurance businesses. For the second quarter, total wealth sales jumped 25% and insurance sales increased 8% compared with last year.

Revenue diversification

Sun Life received 39% of its Q2 2015 net income from its Canadian operations. The company’s U.S.-based global wealth management unit, MFS, contributed 27% of earnings, while Sun Life U.S. pitched in another 16% of the profits. Overseas, the Asian operations accounted for 11% of overall earnings, and the U.K. group added the remaining 7%.

Solid balance sheet

Sun Life really took it on the chin during the financial crisis, but management learned from its mistakes, and the company is much less exposed to sharp movements in equity markets or interest rates than it used to be. The company is also very well capitalized with a MCCSR ratio of 223%. The minimum requirement for Canadian insurance companies is 150%.

At the end of Q2, Sun Life had $1.7 billion in cash sitting on its balance sheet.

Investments in growth

Sun life has been on a buying binge over the past year, with a focus on asset management firms. The company wants to beef up its presence in the asset management space as a way to diversify its revenue stream.

Asia also remains a key area of growth. Sun Life is expected to increase its investment in the company’s Birla Sun Life partnership in India. New rules allow foreign insurers to boost their ownership from 26% to 49%. India’s insurance industry is growing rapidly with one estimate expecting a four-fold expansion in the next 10 years.

Dividend strength

Management increased the dividend by 6% earlier this year to $1.52 per share. That’s good for a yield of 3.5%.

Should you Buy Sun Life instead of the banks?

Sun Life offers Canadian investors strong international exposure to growing markets while minimizing the risks faced by the banks in Canada—specifically the exposure to the oil and gas sector and an over-heated housing market.

Given its solid ROE numbers, a growing dividend, and rising stock price, Sun Life might be a smarter bet right now.

Attention bank investors: don't miss this report!

Canadian banks are considered must-have investments. After all, they're very stable, well capitalized, and face limited competition. That said, there are concerns for the banks and their investors.

In the following report, we cover everything you need to know about Canada's Big Five--whether you're already an investor or considering buying shares.

Simply click here now to receive your special FREE analysis, "What Every Bank Shareholder MUST Know." Yes, today it's free!


Let’s not beat around the bush – energy companies performed miserably in 2015. Yet, even though the carnage was widespread, not all energy-related businesses were equally affected.

We've identified an energy company we think offers one of the best growth opportunities around. While this company is largely tied to the production of natural gas, it doesn't actually produce the gas. Instead, it provides the equipment required to get natural gas from the ground to the end user. With diversified operations around the globe, we think it's a rare find in the industry.

We like it so much, we’ve named it as 1 Top Stock for 2016 and Beyond. To find out why, simply enter your email address below to claim your FREE copy of this brand new report, "1 Top Stock for 2016 and Beyond"!

Fool contributor Andrew Walker has no position in any stocks mentioned.