Better Buy: Manulife Stock vs. Suncor Stock

Manulife Financial Corp. (TSX:MFC) and Suncor Energy Inc. (TSX:SU) are powerhouses that offer nice value and income right now.

| More on:

Image source: Getty Images

The S&P/TSX Composite Index was up 35 points in early afternoon trading on January 26. Some of the best-performing sectors included energy and financials. That is good news for investors, as these are the heaviest-hitting sectors on the TSX. Today, I want to look at two top stocks in these spaces: Manulife Financial (TSX:MFC) and Suncor Energy (TSX:SU). Which is the better buy between these two? Let’s jump in.

Is Manulife stock worth your attention in late January?

Manulife is a Toronto-based company that provides financial products and services in Canada, the United States, Asia, and around the world. Shares of this financial stock have climbed 2.7% year over year as of early afternoon trading on January 26. The stock has jumped 8.5% so far in the new year.

Investors should be inspired to target Manulife, as it offers exposure to the burgeoning insurance and wealth management spaces. Better yet, these spaces have experienced huge growth in Asia due to the significant growth in its middle-class population.

This company is set to release its fourth-quarter and full-year fiscal 2022 earnings in the middle of February. Manulife unveiled its third-quarter fiscal 2022 results on November 9. The company saw its Global Wealth and Asset Management net inflows fall to $3.0 billion compared to $9.8 billion in the third quarter of fiscal 2021. This was due to worsening market conditions and the fear of rising interest rates. Core earnings in its Asia and Canada based business were mostly flat in the year-over-year period.

Shares of Manulife currently possess a favourable price-to-earnings ratio of seven. Better yet, it offers a quarterly dividend of $0.33 per share. That represents a strong 4.9% yield.

Here’s why Suncor is a dependable bet for the long term

Suncor is one of the largest integrated energy companies in Canada and around the world. Shares of this Calgary-based company have increased 28% compared to the prior year. Meanwhile, its stock is up 10% so far in 2023.

The company is also expected to unveil its final batch of fiscal 2022 earnings by the middle of February. In the third quarter of 2022, Suncor reported adjusted funds from operations (AFFO) of $4.47 billion, or $3.28 per common share compared to $2.64 billion, or $1.79 per common share, in the third quarter of fiscal 2021. Meanwhile, adjusted operating earnings more than doubled to $2.56 billion, or $1.88 per common share.

This top energy stock last had an attractive P/E ratio of 8.2. Suncor is trading in more favourable value territory compared to its industry peers. Moreover, it offers a quarterly dividend of $0.52 per share, which represents a very solid 4.5% yield.

Should you buy Manulife or Suncor today?

Suncor is a fantastic hold for investors who want a dependable bet in the energy sector. However, I’m more inclined to snatch up shares of Manulife in late January 2023. Manulife also offers very nice value, and its revenue and earnings are on track for strong growth going forward. Moreover, it offers a superior dividend at the time of this writing.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Ambrose O'Callaghan has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

More on Investing

exchange traded funds
Investing

Got $500 to Invest in Stocks? Put it in This ETF

Canadian investors should consider gaining exposure to low-cost exchange-traded funds that track the S&P 500 index.

Read more »

The sun sets behind a power source
Dividend Stocks

Forget Canopy Growth: 3 Utility Stocks to Buy Instead

These top Canadian utility stocks look like excellent buys to protect and grow your capital.

Read more »

Woman has an idea
Investing

3 Things About goeasy Stock Every Smart Investor Knows

Here are three things about goeasy stock that every smart investor knows or needs to know.

Read more »

Target. Stand out from the crowd
Dividend Stocks

1 Dividend Stock Down 30% to Buy Right Now

Keyera is an energy infrastructure company that pays shareholders a forward yield of almost 6%. Is KEY stock a good…

Read more »

oil and natural gas
Dividend Stocks

Suncor Stock Is Rallying: Should You Invest?

Energy stocks like Suncor Energy Inc (TSX:SU) are rising with oil pries.

Read more »

A stock price graph showing growth over time
Investing

3 Growth Stocks That Could More Than Double Their Revenue by 2025

Three outperforming stocks with rising revenues are profitable options for growth investors.

Read more »

tsx today
Stock Market

TSX Today: What to Watch for in Stocks on Monday, April 15

TSX investors may want to remain cautious, as any major update related to the ongoing Iran-Israel conflict could increase market…

Read more »

A worker gives a business presentation.
Dividend Stocks

TSX Communications in April 2024: The Best Stocks to Buy Right Now

Here are two of the best TSX communication stocks you can buy in April 2024 and hold for years to…

Read more »