Intrinsic value of Sun Life Financial Inc. - SLF

Previous Close

$52.59

  Intrinsic Value

$200.81

stock screener

  Rating & Target

str. buy

+282%

Previous close

$52.59

 
Intrinsic value

$200.81

 
Up/down potential

+282%

 
Rating

str. buy

*Intrinsic value change (in %) minus stock price change (in %) in the past 12 months.

We calculate the intrinsic value of SLF stock by summing up the current values of future distributable cash flows generated by the company and dividing the sum by the number of outstanding shares. As such, the intrinsic value calculation depends entirely on projections. The more accurate your projections of the company's performance are - the more reliable is the intrinsic value calculation result. Please make sure to check the stock valuation input data below and adjust it if necessary. The quality of the output (intrinsic valuation result) is only as good as the quality of the input. See also DISCLAIMERS.

STOCK VALUATION INPUT DATA

Revenue (in 2016), $M
Initial revenue growth rate, %
Terminal revenue growth rate, %
Revenue decline factor
Initial discount rate, %
Discount rate multiplier
Variable cost ratio, %
Fixed operating expenses, $M
Interest rate on debt, %
Effective corporate tax rate, %
Production assets / Revenue, %
Life of production assets, yrs
Working capital / Revenue, %
Revenue / Adjusted assets
Adjusted equity ratio
Cash flow adjustment, % of Revenue
Book value of equity, $M
Shares outstanding, mln
Market capitalization, $bln 32.2

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
2016(a)
   2017
   2018
   2019
   2020
   2021
   2022
   2023
   2024
   2025
   2026
   2027
   2028
   2029
   2030
   2031
   2032
   2033
   2034
   2035
   2036
   2037
   2038
   2039
   2040
   2041
   2042
   2043
   2044
   2045
   2046

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  48.25
  2.00
  2.30
  2.57
  2.81
  3.03
  3.23
  3.41
  3.57
  3.71
  3.84
  3.95
  4.06
  4.15
  4.24
  4.31
  4.38
  4.44
  4.50
  4.55
  4.59
  4.64
  4.67
  4.70
  4.73
  4.76
  4.78
  4.81
  4.83
  4.84
  4.86
Revenue, $m
  0
  29,144
  29,815
  30,581
  31,441
  32,394
  33,440
  34,579
  35,812
  37,140
  38,565
  40,090
  41,717
  43,450
  45,291
  47,245
  49,315
  51,507
  53,824
  56,273
  58,859
  61,587
  64,464
  67,497
  70,692
  74,058
  77,601
  81,331
  85,256
  89,385
  93,727
Variable operating expenses, $m
 
  24,267
  24,813
  25,437
  26,137
  26,913
  27,765
  28,693
  29,697
  30,778
  31,939
  32,649
  33,974
  35,385
  36,885
  38,476
  40,162
  41,947
  43,834
  45,828
  47,934
  50,156
  52,499
  54,969
  57,571
  60,312
  63,198
  66,235
  69,431
  72,794
  76,331
Fixed operating expenses, $m
 
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total operating expenses, $m
  24,812
  24,267
  24,813
  25,437
  26,137
  26,913
  27,765
  28,693
  29,697
  30,778
  31,939
  32,649
  33,974
  35,385
  36,885
  38,476
  40,162
  41,947
  43,834
  45,828
  47,934
  50,156
  52,499
  54,969
  57,571
  60,312
  63,198
  66,235
  69,431
  72,794
  76,331
Operating income, $m
  3,761
  4,878
  5,002
  5,144
  5,304
  5,481
  5,675
  5,886
  6,115
  6,362
  6,626
  7,441
  7,743
  8,065
  8,406
  8,769
  9,153
  9,560
  9,990
  10,445
  10,925
  11,431
  11,965
  12,528
  13,121
  13,746
  14,403
  15,096
  15,824
  16,591
  17,397
EBITDA, $m
  3,761
  5,573
  5,701
  5,847
  6,012
  6,194
  6,394
  6,612
  6,848
  7,102
  7,374
  7,666
  7,977
  8,308
  8,660
  9,034
  9,429
  9,849
  10,292
  10,760
  11,254
  11,776
  12,326
  12,906
  13,517
  14,160
  14,838
  15,551
  16,302
  17,091
  17,921
Interest expense (income), $m
  245
  305
  306
  524
  772
  1,051
  1,360
  1,700
  2,069
  2,469
  2,899
  3,362
  3,856
  4,384
  4,946
  5,543
  6,177
  6,848
  7,559
  8,311
  9,105
  9,943
  10,828
  11,761
  12,745
  13,781
  14,873
  16,022
  17,232
  18,504
  19,844
Earnings before tax, $m
  3,445
  4,572
  4,696
  4,621
  4,532
  4,430
  4,315
  4,187
  4,046
  3,893
  3,727
  4,079
  3,887
  3,681
  3,461
  3,226
  2,977
  2,712
  2,431
  2,134
  1,820
  1,488
  1,137
  767
  376
  -36
  -469
  -926
  -1,407
  -1,914
  -2,447
Tax expense, $m
  619
  1,235
  1,268
  1,248
  1,224
  1,196
  1,165
  1,130
  1,093
  1,051
  1,006
  1,101
  1,049
  994
  934
  871
  804
  732
  656
  576
  491
  402
  307
  207
  102
  0
  0
  0
  0
  0
  0
Net income, $m
  2,826
  3,338
  3,428
  3,373
  3,308
  3,234
  3,150
  3,056
  2,954
  2,842
  2,721
  2,978
  2,837
  2,687
  2,526
  2,355
  2,173
  1,980
  1,775
  1,558
  1,329
  1,086
  830
  560
  275
  -36
  -469
  -926
  -1,407
  -1,914
  -2,447

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total assets, $m
  258,238
  262,563
  268,602
  275,505
  283,255
  291,842
  301,264
  311,524
  322,631
  334,596
  347,437
  361,174
  375,833
  391,440
  408,027
  425,628
  444,280
  464,025
  484,904
  506,966
  530,260
  554,839
  580,759
  608,082
  636,869
  667,188
  699,111
  732,711
  768,068
  805,266
  844,391
Adjusted assets (=assets-cash), $m
  258,238
  262,563
  268,602
  275,505
  283,255
  291,842
  301,264
  311,524
  322,631
  334,596
  347,437
  361,174
  375,833
  391,440
  408,027
  425,628
  444,280
  464,025
  484,904
  506,966
  530,260
  554,839
  580,759
  608,082
  636,869
  667,188
  699,111
  732,711
  768,068
  805,266
  844,391
Revenue / Adjusted assets
  0.000
  0.111
  0.111
  0.111
  0.111
  0.111
  0.111
  0.111
  0.111
  0.111
  0.111
  0.111
  0.111
  0.111
  0.111
  0.111
  0.111
  0.111
  0.111
  0.111
  0.111
  0.111
  0.111
  0.111
  0.111
  0.111
  0.111
  0.111
  0.111
  0.111
  0.111
Average production assets, $m
  1,591
  1,632
  1,670
  1,713
  1,761
  1,814
  1,873
  1,936
  2,005
  2,080
  2,160
  2,245
  2,336
  2,433
  2,536
  2,646
  2,762
  2,884
  3,014
  3,151
  3,296
  3,449
  3,610
  3,780
  3,959
  4,147
  4,346
  4,555
  4,774
  5,006
  5,249
Working capital, $m
  0
  466
  477
  489
  503
  518
  535
  553
  573
  594
  617
  641
  667
  695
  725
  756
  789
  824
  861
  900
  942
  985
  1,031
  1,080
  1,131
  1,185
  1,242
  1,301
  1,364
  1,430
  1,500
Total debt, $m
  7,632
  7,656
  13,091
  19,304
  26,279
  34,008
  42,488
  51,722
  61,718
  72,486
  84,043
  96,407
  109,599
  123,646
  138,574
  154,415
  171,202
  188,972
  207,764
  227,619
  248,584
  270,705
  294,033
  318,623
  344,532
  371,819
  400,550
  430,790
  462,612
  496,089
  531,302
Total liabilities, $m
  236,282
  236,306
  241,741
  247,954
  254,929
  262,658
  271,138
  280,372
  290,368
  301,136
  312,693
  325,057
  338,249
  352,296
  367,224
  383,065
  399,852
  417,622
  436,414
  456,269
  477,234
  499,355
  522,683
  547,273
  573,182
  600,469
  629,200
  659,440
  691,262
  724,739
  759,952
Total equity, $m
  21,956
  26,256
  26,860
  27,550
  28,325
  29,184
  30,126
  31,152
  32,263
  33,460
  34,744
  36,117
  37,583
  39,144
  40,803
  42,563
  44,428
  46,402
  48,490
  50,697
  53,026
  55,484
  58,076
  60,808
  63,687
  66,719
  69,911
  73,271
  76,807
  80,527
  84,439
Total liabilities and equity, $m
  258,238
  262,562
  268,601
  275,504
  283,254
  291,842
  301,264
  311,524
  322,631
  334,596
  347,437
  361,174
  375,832
  391,440
  408,027
  425,628
  444,280
  464,024
  484,904
  506,966
  530,260
  554,839
  580,759
  608,081
  636,869
  667,188
  699,111
  732,711
  768,069
  805,266
  844,391
Debt-to-equity ratio
  0.348
  0.290
  0.490
  0.700
  0.930
  1.170
  1.410
  1.660
  1.910
  2.170
  2.420
  2.670
  2.920
  3.160
  3.400
  3.630
  3.850
  4.070
  4.280
  4.490
  4.690
  4.880
  5.060
  5.240
  5.410
  5.570
  5.730
  5.880
  6.020
  6.160
  6.290
Adjusted equity ratio
  0.085
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  2,826
  3,338
  3,428
  3,373
  3,308
  3,234
  3,150
  3,056
  2,954
  2,842
  2,721
  2,978
  2,837
  2,687
  2,526
  2,355
  2,173
  1,980
  1,775
  1,558
  1,329
  1,086
  830
  560
  275
  -36
  -469
  -926
  -1,407
  -1,914
  -2,447
Depreciation, amort., depletion, $m
  0
  695
  699
  703
  708
  713
  719
  725
  732
  740
  748
  225
  234
  243
  254
  265
  276
  288
  301
  315
  330
  345
  361
  378
  396
  415
  435
  455
  477
  501
  525
Funds from operations, $m
  767
  4,033
  4,127
  4,076
  4,016
  3,947
  3,869
  3,782
  3,686
  3,582
  3,468
  3,202
  3,071
  2,930
  2,780
  2,620
  2,449
  2,268
  2,076
  1,873
  1,658
  1,431
  1,191
  938
  670
  379
  -35
  -471
  -930
  -1,413
  -1,922
Change in working capital, $m
  -2,901
  9
  11
  12
  14
  15
  17
  18
  20
  21
  23
  24
  26
  28
  29
  31
  33
  35
  37
  39
  41
  44
  46
  49
  51
  54
  57
  60
  63
  66
  69
Cash from operations, $m
  3,668
  4,024
  4,116
  4,064
  4,002
  3,932
  3,852
  3,764
  3,666
  3,560
  3,446
  3,178
  3,045
  2,902
  2,750
  2,588
  2,416
  2,233
  2,039
  1,834
  1,617
  1,387
  1,145
  889
  619
  325
  -91
  -530
  -993
  -1,479
  -1,992
Maintenance CAPEX, $m
  0
  -159
  -163
  -167
  -171
  -176
  -181
  -187
  -194
  -201
  -208
  -216
  -225
  -234
  -243
  -254
  -265
  -276
  -288
  -301
  -315
  -330
  -345
  -361
  -378
  -396
  -415
  -435
  -455
  -477
  -501
New CAPEX, $m
  -131
  -41
  -38
  -43
  -48
  -53
  -59
  -64
  -69
  -74
  -80
  -85
  -91
  -97
  -103
  -109
  -116
  -123
  -130
  -137
  -145
  -153
  -161
  -170
  -179
  -188
  -198
  -209
  -220
  -231
  -243
Cash from investing activities, $m
  -1,893
  -200
  -201
  -210
  -219
  -229
  -240
  -251
  -263
  -275
  -288
  -301
  -316
  -331
  -346
  -363
  -381
  -399
  -418
  -438
  -460
  -483
  -506
  -531
  -557
  -584
  -613
  -644
  -675
  -708
  -744
Free cash flow, $m
  1,775
  3,823
  3,915
  3,854
  3,783
  3,702
  3,612
  3,513
  3,404
  3,285
  3,158
  2,877
  2,729
  2,572
  2,404
  2,225
  2,036
  1,834
  1,621
  1,395
  1,157
  905
  639
  358
  62
  -259
  -705
  -1,174
  -1,668
  -2,188
  -2,735
Issuance/(repayment) of debt, $m
  -217
  24
  5,435
  6,213
  6,975
  7,729
  8,480
  9,234
  9,996
  10,769
  11,557
  12,364
  13,193
  14,047
  14,928
  15,841
  16,787
  17,770
  18,792
  19,856
  20,964
  22,121
  23,329
  24,590
  25,909
  27,287
  28,730
  30,240
  31,822
  33,478
  35,213
Issuance/(repurchase) of shares, $m
  39
  962
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  313
  648
  1,001
  1,372
  1,762
  2,173
  2,604
  3,067
  3,662
  4,286
  4,943
  5,634
  6,360
Cash from financing (excl. dividends), $m  
  -469
  986
  5,435
  6,213
  6,975
  7,729
  8,480
  9,234
  9,996
  10,769
  11,557
  12,364
  13,193
  14,047
  14,928
  15,841
  16,787
  17,770
  19,105
  20,504
  21,965
  23,493
  25,091
  26,763
  28,513
  30,354
  32,392
  34,526
  36,765
  39,112
  41,573
Total cash flow (excl. dividends), $m
  1,071
  4,810
  9,350
  10,067
  10,758
  11,431
  12,092
  12,747
  13,399
  14,054
  14,715
  15,240
  15,922
  16,618
  17,332
  18,066
  18,823
  19,604
  20,726
  21,899
  23,122
  24,398
  25,730
  27,121
  28,575
  30,096
  31,687
  33,353
  35,097
  36,923
  38,837
Retained Cash Flow (-), $m
  -706
  -4,300
  -604
  -690
  -775
  -859
  -942
  -1,026
  -1,111
  -1,197
  -1,284
  -1,374
  -1,466
  -1,561
  -1,659
  -1,760
  -1,865
  -1,974
  -2,088
  -2,206
  -2,329
  -2,458
  -2,592
  -2,732
  -2,879
  -3,067
  -3,662
  -4,286
  -4,943
  -5,634
  -6,360
Prev. year cash balance distribution, $m
 
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash flow adjustment, $m
 
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash available for distribution, $m
 
  510
  8,746
  9,376
  9,983
  10,572
  11,150
  11,721
  12,289
  12,858
  13,430
  13,867
  14,456
  15,058
  15,674
  16,306
  16,957
  17,630
  18,638
  19,693
  20,793
  21,940
  23,138
  24,389
  25,696
  27,029
  28,026
  29,066
  30,154
  31,290
  32,478
Discount rate, %
 
  4.30
  4.52
  4.74
  4.98
  5.23
  5.49
  5.76
  6.05
  6.35
  6.67
  7.00
  7.35
  7.72
  8.11
  8.51
  8.94
  9.39
  9.86
  10.35
  10.87
  11.41
  11.98
  12.58
  13.21
  13.87
  14.56
  15.29
  16.05
  16.86
  17.70
PV of cash for distribution, $m
 
  489
  8,007
  8,160
  8,220
  8,195
  8,092
  7,918
  7,681
  7,386
  7,041
  6,585
  6,169
  5,725
  5,262
  4,787
  4,309
  3,836
  3,432
  3,032
  2,642
  2,269
  1,920
  1,598
  1,309
  1,051
  818
  624
  467
  342
  245
Current shareholders' claim on cash, %
  100
  97.1
  97.1
  97.1
  97.1
  97.1
  97.1
  97.1
  97.1
  97.1
  97.1
  97.1
  97.1
  97.1
  97.1
  97.1
  97.1
  97.1
  96.7
  95.8
  94.5
  92.9
  90.9
  88.6
  86.1
  83.4
  80.4
  77.1
  73.7
  70.2
  66.6

Sun Life Financial Inc. is the holding company of Sun Life Assurance Company of Canada. The Company is a financial services company providing a range of insurance, wealth and asset management solutions to individuals and corporate Clients. It operates through five segments. The Sun Life Financial Canada segment provides retail insurance and investment advice, products and services to people across Canada. The SLF U.S. segment has three business units: Group Benefits, International and In-force Management. Its Sun Life Financial Asset Management segment consists of MFS Investment Management and Sun Life Investment Management. The SLF Asia segment operates through subsidiaries in the Philippines, Hong Kong, Indonesia and Vietnam, as well as through joint ventures and associates with local partners in the Philippines, India, China and Malaysia. Its Corporate segment includes SLF U.K. and Corporate Support. Corporate Support operations consist of its Run-off reinsurance business.

FINANCIAL RATIOS  of  Sun Life Financial Inc. (SLF)

Valuation Ratios
P/E Ratio 11.4
Price to Sales 1.1
Price to Book 1.5
Price to Tangible Book
Price to Cash Flow 8.8
Price to Free Cash Flow 9.1
Growth Rates
Sales Growth Rate 48.2%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 23.6%
Cap. Spend. - 3 Yr. Gr. Rate 14.4%
Financial Strength
Quick Ratio 0
Current Ratio NaN
LT Debt to Equity 32.7%
Total Debt to Equity 34.8%
Interest Coverage 15
Management Effectiveness
Return On Assets 1.2%
Ret/ On Assets - 3 Yr. Avg. 1.1%
Return On Total Capital 10.2%
Ret/ On T. Cap. - 3 Yr. Avg. 8.8%
Return On Equity 13.1%
Return On Equity - 3 Yr. Avg. 11.6%
Asset Turnover 0.1
Profitability Ratios
Gross Margin 0%
Gross Margin - 3 Yr. Avg. 0%
EBITDA Margin 12.9%
EBITDA Margin - 3 Yr. Avg. 13.3%
Operating Margin 13.2%
Oper. Margin - 3 Yr. Avg. 13.5%
Pre-Tax Margin 12.1%
Pre-Tax Margin - 3 Yr. Avg. 12.1%
Net Profit Margin 9.9%
Net Profit Margin - 3 Yr. Avg. 9.7%
Effective Tax Rate 18%
Eff/ Tax Rate - 3 Yr. Avg. 19.8%
Payout Ratio 38%

SLF stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the SLF stock intrinsic value calculation we used $28573 million for the last fiscal year's total revenue generated by Sun Life Financial Inc.. The default revenue input number comes from 2016 income statement of Sun Life Financial Inc.. You may change it if you feel that it should be adjusted for some unusual circumstances that are not expected to be repeated in the future or if you already know (from interim financial statements, for example) that this year's revenue is going to be quite different.

Revenue growth rate. Forecasted future revenue growth rate is the most important input parameter for the intrinsic value calculation. Unlike other input parameters that are reasonably expected to be in line with their historic averages or their historic trends, the revenue growth rate by and large is a wild card: nobody really knows what the company's revenue will be in the future. Of course, the level of unpredictability is different for different industries (utility companies being the most predictable and, thus, less risky).
    We use three input parameters to forecast the revenue growth rate in our SLF stock valuation model: a) initial revenue growth rate of 2% whose default value is the revenue growth rate in the most recent quarter compared to the quarterly revenue a year ago; b) terminal revenue growth rate of 5% whose default value is chosen to be close to the average nominal (i.e. not adjusted for inflation) GDP growth rate; and c) revenue decline factor of 0.9, which stipulates that revenue growth rate in each forecasted year will be equal to the difference of the revenue growth rate in the preceding year and the terminal revenue growth rate multiplied by this revenue decline factor (with the passage of time the revenue growth rate will be approaching the terminal revenue growth rate, but not quite reaching it - though the difference could be infinitesimally small).
    At the revenue decline factor of 1, the future revenue growth rate is forecasted to be constant and equal to the initial revenue growth rate. The smaller the revenue decline factor, the faster the revenue growth rate will approach the terminal revenue growth.

Discount rate. The discount rate is used for determining the present value of future cash flows: future cash flows are "discounted" as at normal conditions (that translate into positive expected return on investment) one dollar today is worth more than the same dollar in the future. Unlike all other valuation models, we use variable discount rate, i.e. it increases for each consecutive year. This is done to account for higher risk of cash flows coming in further in the future.
    The initial discount rate of 4.3%, whose default value for SLF is calculated based on our internal credit rating of Sun Life Financial Inc., is applied to the cash flow expected to be received a year from now (well, actually, to be precise, in the financial year following the base year - the last year for which we have financial statements). For each consecutive year the discount rate is multiplied by the discount rate multiplier of 1.05, e.i. each year it increases by 5%. Feel free to change this number to correspond to your level of risk assessment of Sun Life Financial Inc..
    By the way, it is easy to set the discount rate to be constant (this would make comparison with other valuation models easier): just set the discount rate multiplier equal to 1 and chose the magnitude of the initial discount rate to your liking.

Variable cost ratio is the ratio of variable costs (i.e. costs that fluctuate with fluctuation of the volume of production) to the revenue expressed as a percentage. In the calculation of intrinsic value of SLF stock the variable cost ratio is equal to 83.3%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $0 million in the base year in the intrinsic value calculation for SLF stock. These expenses increase with the level of inflation in subsequent years.

Interest rate on debt is the average all-in rate of interest paid by the company on its debt. It is set at 4% for Sun Life Financial Inc..

Corporate tax rate of 27% is the nominal tax rate for Sun Life Financial Inc.. In reality, companies find ways to pay much less taxes than that or not to pay them at all.

Cash flow adjustment could be used for any adjustment the investor deems necessary. Most commonly we use this field to account for stock options-related effects in excess of what is reported on the company's income statement. The cash flow adjustment is expressed as a percentage of the revenue, and in the current valuation of the SLF stock is equal to 0%.

Production assets are the company's assets used for manufacturing products or provision of services. In the valuation model input table they are expressed as a percentage of revenue and for SLF are equal to 5.6%.

Life of production assets of 10 years is the average useful life of capital assets used in Sun Life Financial Inc. operations. It is used to calculate yearly capital expenditures needed to keep these assets in good order - we call it the maintenance CAPEX.

Working capital is the difference between the company's current assets and liabilities. In the model we use the ratio of working capital to revenue, which for SLF is equal to 1.6%. A negative number means that the company is apt at using financial resources of its suppliers and customers; a large positive number, on the other hand, means that it either provides in-kind financing to others or is not good at managing its inventories.

Book value of equity - $21956 million for Sun Life Financial Inc. - is used in calculation of the "floor" for intrinsic valuation based on the discounted cash flow (DCF) method. Even if the prospects are very bad for a company, its assets could always be sold now for their current fair market value.

Shares outstanding of 611.949 million for Sun Life Financial Inc. is needed to calculate the intrinsic value of one share.

Market capitalization is used here only for reference purposes and as a quick check that the share price and the number of shares outstanding numbers are correct - something especially to be cognizant about at stock splits. So, the market capitalization of Sun Life Financial Inc. at the current share price and the inputted number of shares is $32.2 billion.

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Financial statements of SLF
Valuation of Stocks

The paper VALUATION OF STOCKS: The Quest for Intrinsic Value provides a detailed description of our valuation model and discloses the calculation algorithm.

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