E-L Financial (ELF) AI Stock Analysis

• Market Cap: C$5.37B
• Dividend Yield: 0.98%
• Average Volume (3M): 35.74K
• Price to Earnings (P/E): 4.4
• Beta (1Y): 0.91
• Revenue Growth: -23.51%
• EPS Growth: 1.19%
• Country: CA
• Employees: 1,236
• Sector: Financial
• Sector Strength: 70
• Industry: Insurance - Life
• EPS (TTM): 1.05
• Shares Outstanding: 346,172,200
• 10 Day Avg. Volume: 27,596
• 30 Day Avg. Volume: 35,742
• 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: C$16.50
• Price Target Upside: 8.13% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 1

• Rating: 68 Neutral
• Price Target: C$16.50 ▲(8.13% Upside)

E-L Financial's strong valuation with a low P/E ratio is a significant positive factor, suggesting potential undervaluation. However, mixed financial performance with declining revenue growth and cash flow challenges, combined with neutral technical indicators, moderate the overall score.

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 makes money primarily through its two business segments: E-L Corporate and Empire Life. The E-L Corporate segment generates revenue from its investment portfolio, which includes dividends, interest income, and capital gains from its holdings in equities, fixed income securities, and other investments. The Empire Life segment earns revenue through premiums paid by policyholders for its life and health insurance products, as well as fees and commissions from its investment products and services. Additionally, the company's profitability is influenced by its investment performance, underwriting results, and effective management of its insurance liabilities. Significant partnerships with financial advisors, brokers, and employers help expand its distribution network, further contributing to its revenue streams.

E-L Financial Financial Statement Overview

Summary

E-L Financial shows 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	2.46B	3.35B	2.75B	-706.98M	2.32B	2.56B
Gross Profit	831.33M	2.14B	4.00B	-706.98M	2.32B	2.56B
EBITDA	1.56B	2.12B	581.12M	-537.11M	1.38B	775.40M
Net Income	1.24B	1.57B	955.28M	-327.31M	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: Positive
• Last Price: 15.26
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• 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 Positive. The current price of 15.26 is above the 20-day moving average (MA) of 15.07, above the 50-day MA of 15.16, and above the 200-day MA of 13.96, indicating a bullish trend. The MACD of 0.14 indicates Negative momentum. The RSI at 53.06 is Neutral, neither overbought nor oversold. The STOCH value of 72.62 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:ELF.

E-L Financial Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ELF	68 Neutral	C$5.37B	4.37	15.46%	0.98%	-23.51%	1.19%
Sector *	68 Neutral	$17.80B	11.94	9.89%	3.74%	9.69%	1.17%
MFC	―	$52.16B	13.62	11.57%	3.99%	―	―
SLF	―	$32.58B	14.24	13.38%	4.19%	―	―
GWO	76 Outperform	C$50.06B	13.53	14.19%	4.40%	15.27%	4.72%
POW	73 Outperform	C$36.87B	13.50	12.07%	5.19%	11.56%	1.15%
DFY	73 Outperform	C$8.98B	21.77	11.48%	0.95%	18.98%	0.82%

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.

E-L Financial Initiates Automatic Share Purchase Plan to Enhance Shareholder Value

E-L Financial Corporation Limited has announced the implementation of an automatic share purchase plan (ASPP) as part of its normal course issuer bid, effective June 30, 2025. This plan allows the company to repurchase shares during trading blackout periods, with purchases financed from working capital. The ASPP will continue until the bid expires, the annual purchase limit is reached, or it is otherwise terminated. The company has approval to purchase up to 173,086 shares, adjusted for a recent share split, but has not yet repurchased any shares. The move is expected to enhance shareholder value by optimizing capital use.