E-L Financial (ELF) AI Stock Analysis

• Market Cap: C$5.84B
• Dividend Yield: 896.98%
• Average Volume (3M): 29.60K
• Price to Earnings (P/E): 4.5
• Beta (1Y): 1.19
• Revenue Growth: -31.32%
• EPS Growth: -26.23%
• Country: CA
• Employees: 1,236
• Sector: Financial
• Sector Strength: 70
• Industry: Insurance - Life
• EPS (TTM): 1.65
• Shares Outstanding: 346,165,600
• 10 Day Avg. Volume: 21,106
• 30 Day Avg. Volume: 29,601
• PEG Ratio: -0.03
• Price to Book (P/B): 0.53
• Price to Sales (P/S): 1.33
• P/FCF Ratio: 9.71
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 73 Outperform
• Price Target: C$18.50 ▲(11.31% Upside)

E-L Financial's strong valuation metrics, particularly the low P/E ratio and high dividend yield, are the most significant factors driving the score. The company's solid financial performance, despite challenges in revenue growth and cash flow, also contributes positively. Technical analysis supports a moderately bullish outlook, reinforcing the overall positive assessment.

Positive Factors

Strong Balance Sheet

A low debt-to-equity ratio indicates financial stability and low leverage, providing the company with flexibility to invest in growth opportunities.

Profitability

High profit margins suggest efficient operations and strong pricing power, which can sustain long-term profitability and shareholder returns.

Cash Generation Efficiency

Efficient cash generation relative to net income indicates the company's ability to convert earnings into cash, supporting reinvestment and dividends.

Negative Factors

Declining Revenue Growth

Declining revenue growth can limit the company's ability to expand its market share and may impact long-term financial performance.

Cash Flow Challenges

A decline in free cash flow growth suggests potential difficulties in funding operations and investments, which could strain financial resources.

Cost Management Issues

Decreasing gross profit margins may indicate rising costs or pricing pressures, which can erode profitability if not managed effectively.

E-L Financial Business Overview & Revenue Model

Company Description

E-L Financial Corporation Limited operates as an investment and insurance holding company in Canada. It operates through two segments, E-L Corporate and Empire Life. The company owns investments in equities and fixed income securities directly and indirectly through pooled funds, closed-end investment companies, and other investment companies. It also underwrites life and health insurance policies, wealth management products, group plans, and financial services, as well as segregated funds, mutual funds, and annuity products to individuals, professionals, and businesses through a network of independent financial advisors, managing general agents, national account firms, mutual fund dealers, and employee benefit brokers and representatives. E-L Financial Corporation Limited was incorporated in 1968 and is headquartered in Toronto, Canada.

How the Company Makes Money

E-L Financial generates revenue through multiple streams, primarily from premiums collected on life insurance policies and investment income derived from its investment portfolio. The company earns premiums from its life insurance products, which contribute significantly to its overall revenue. Additionally, ELF invests in a diverse range of assets, including equities, fixed income, and alternative investments, generating investment income. The firm may also realize capital gains from the sale of investments. Strategic partnerships with other financial institutions and investment managers can further enhance its revenue through collaborative investment strategies or distribution of its products. The stability of its earnings is supported by a strong balance sheet and prudent risk management practices.

E-L Financial Financial Statement Overview

Summary

E-L Financial demonstrates strong profitability and a solid balance sheet with low leverage. However, declining revenue growth and cash flow challenges present potential risks. The company needs to address revenue generation and cash conversion to maintain its financial health.

Income Statement

E-L Financial's income statement shows mixed performance. The TTM data indicates a decline in revenue growth at -1.4%, which is concerning. However, the company maintains strong profitability with a high net profit margin of 104.7% and EBIT margin of 136.8% in the TTM period. The gross profit margin has decreased significantly from previous periods, indicating potential cost management issues.

Balance Sheet

The balance sheet reflects a strong financial position with a low debt-to-equity ratio of 0.075, indicating low leverage. The return on equity is healthy at 13.7% in the TTM period, although it has decreased from previous years. The equity ratio remains stable, suggesting a solid capital structure.

Cash Flow

Cash flow analysis reveals challenges, with a significant decline in free cash flow growth at -28.2% in the TTM period. The operating cash flow to net income ratio is zero, indicating potential issues in converting income to cash. However, the free cash flow to net income ratio remains strong at 1.0, suggesting efficient cash generation relative to net income.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	3.28B	3.35B	3.00B	-1.18B	2.32B	2.56B
Gross Profit	1.74B	2.14B	1.42B	-758.24M	1.61B	989.91M
EBITDA	1.63B	2.12B	1.32B	-525.74M	1.56B	764.89M
Net Income	1.24B	1.57B	955.28M	-331.44M	1.17B	503.74M
Balance Sheet
Total Assets	28.02B	28.12B	25.76B	23.49B	26.79B	24.95B
Cash, Cash Equivalents and Short-Term Investments	380.62M	374.25M	445.82M	2.04B	2.60B	427.76M
Total Debt	599.40M	598.87M	733.37M	702.91M	602.16M	602.27M
Total Liabilities	18.43B	18.38B	17.50B	15.75B	18.20B	17.29B
Stockholders Equity	8.37B	8.47B	7.11B	6.71B	7.32B	6.52B
Cash Flow
Free Cash Flow	290.01M	459.55M	736.01M	380.95M	344.42M	321.21M
Operating Cash Flow	290.01M	459.55M	736.01M	397.83M	348.10M	329.07M
Investing Cash Flow	494.92M	-76.82M	-386.56M	-437.24M	202.91M	40.12M
Financing Cash Flow	-709.69M	-450.18M	-211.54M	-293.75M	-319.12M	-244.52M

E-L Financial Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 16.62
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:ELF, the sentiment is Neutral. The current price of 16.62 is below the 20-day moving average (MA) of 16.77, above the 50-day MA of 16.50, and above the 200-day MA of 15.10, indicating a neutral trend. The MACD of 0.06 indicates Positive momentum. The RSI at 46.93 is Neutral, neither overbought nor oversold. The STOCH value of 39.24 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TSE:ELF.

E-L Financial Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MFC	79 Outperform	$82.40B	15.57	11.23%	3.59%	5.46%	10.52%
GWO	76 Outperform	C$54.79B	14.86	15.09%	3.88%	-20.64%	14.88%
DFY	76 Outperform	C$7.99B	19.37	13.44%	1.02%	19.80%	-12.93%
ELF	73 Outperform	C$5.84B	4.48	15.37%	896.98%	-31.32%	-26.23%
POW	73 Outperform	C$42.38B	15.45	13.24%	3.41%	-9.03%	44.14%
SLF	70 Outperform	$44.89B	15.27	11.96%	4.37%	-19.88%	-13.92%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%

E-L Financial Corporate Events

E-L Financial Corporation Declares Dividends for 2025

E-L Financial Corporation Limited has announced the declaration of cash dividends for its various classes of shares, including First Preference Shares Series 1, 2, and 3, Series A Preference Shares, and Common Shares. These dividends, payable on October 17, 2025, are eligible for tax purposes under the Income Tax Act of Canada, indicating a stable financial position and commitment to returning value to shareholders.

E-L Financial Reports Mixed Financial Results for Mid-2025

E-L Financial Corporation Limited reported a slight decrease in net equity value per common share to $23.29 as of June 30, 2025, compared to $23.36 at the end of 2024. The company saw a significant increase in consolidated shareholder’s net income for the second quarter of 2025, reaching $365 million, up from $232 million in 2024, primarily driven by a net gain on investments. Empire Life, a subsidiary of E-L Financial, reported a net income of $32 million for the second quarter, a slight decrease from the previous year, due to lower investment and insurance finance results. However, for the first half of 2025, Empire Life’s net income increased to $102 million, attributed to improved insurance service results.