Great-West Lifeco (GWO) AI Stock Analysis

• Market Cap: C$50.50B
• Dividend Yield: 4.27%
• Average Volume (3M): 1.86M
• Price to Earnings (P/E): 13.7
• Beta (1Y): 0.50
• Revenue Growth: 15.27%
• EPS Growth: 4.72%
• Country: CA
• Employees: 33,250
• Sector: Financial
• Sector Strength: 72
• Industry: Insurance - Life
• EPS (TTM): 1.24
• Shares Outstanding: 924,488,800
• 10 Day Avg. Volume: 2,084,289
• 30 Day Avg. Volume: 1,857,796
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• 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$56.40
• Price Target Upside: 2.71% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 5

• Rating: 76 Outperform
• Price Target: C$62.00 ▲(12.91% Upside)

Great-West Lifeco's strong financial performance and strategic growth initiatives, particularly in the U.S. Empower segment, are the most significant factors driving the score. The stock's bullish technical indicators and reasonable valuation further support a positive outlook. However, attention to cost management and addressing credit-related impacts are necessary for sustained growth.

Positive Factors

Dividend Yield

Great-West Lifeco's 4.2% dividend yield offers support to its stock.

Growth Objective

The company maintains a medium-term base EPS growth objective of 8-10%, demonstrating a stable growth outlook.

Return on Equity

The company has increased its medium-term base ROE target to over 19%, reflecting a strong focus on generating higher returns.

Negative Factors

Future Performance Uncertainty

Despite a 4.2% dividend yield providing support, the continued view of Empower as a 'show-me story' indicates uncertainty about its future performance.

Valuation Concerns

The generally full valuation at 11.8x NTM base EPS and earnings visibility challenges in the Europe/Capital & Risk Solutions segments create concerns.

Great-West Lifeco Business Overview & Revenue Model

Company Description

Great-West Lifeco Inc., a financial services holding company, engages in the life and health insurance, retirement and investment services, asset management, and reinsurance businesses in Canada, the United States, and Europe. The company offers a portfolio of financial and benefit plan solutions for individuals, families, businesses, and organizations; life, disability, critical illness, accidental death, dismemberment, health and dental protection, and creditor insurance products; and retirement savings and income, annuity, and other specialty products. It also provides employer-sponsored retirement savings plans, individual retirement and taxable brokerage accounts, enrollment services, communication materials, investment options, and education services; and fund management, investment, and advisory services. In addition, the company offers private-label recordkeeping and administrative services; and investment products, including equity, fixed income, absolute return, and alternative strategies. Further, it provides protection and wealth management products, including payout annuity products; pension products; and life, annuity/longevity, mortgage surety, and property catastrophe reinsurance products. The company offers its products under the Canada Life, Irish Life, Empower, Putnam Investments, and PanAgora brand names. It distributes its products through a network of advisors, dealers, brokers, managing general agencies, financial institutions, consultants, third-party administrators, sales force, financial planners, employee benefit consultants, banks, and multi-tied agents. The company was founded in 1891 and is based in Winnipeg, Canada. Great-West Lifeco Inc. operates as a subsidiary of Power Financial Corporation.

How the Company Makes Money

Great-West Lifeco makes money through a diversified revenue model focusing on insurance premiums, investment income, and asset management fees. Insurance premiums are generated from individual and group life insurance, health insurance, and annuity products. The company earns investment income through its management of invested assets, which include bonds, mortgages, and equities, generating returns that are used to pay policyholder benefits and enhance shareholder value. Additionally, Great-West Lifeco collects fees from its asset management services, provided by subsidiaries like Putnam Investments, which manage mutual funds and institutional accounts. The company also benefits from strategic partnerships and acquisitions, which help expand its market reach and enhance its product offerings, contributing to its overall earnings growth.

Great-West Lifeco Financial Statement Overview

Summary

Great-West Lifeco presents a generally robust financial position with strong profitability and efficient cash flow management. Despite some inconsistencies in revenue growth and a relatively high reliance on liabilities, the company has maintained sound profitability margins and leverage ratios. Continued focus on revenue stability and leveraging cash flow effectively will be crucial for sustaining its financial health.

Income Statement

Great-West Lifeco shows a solid gross profit margin at 83.48% for TTM, indicating strong profitability. The net profit margin for TTM is 17.34%, which is healthy given the industry's nature. However, revenue growth has been inconsistent, with a notable decline from 2022 to 2023, impacting the overall score. The EBIT margin for TTM at 31.65% is strong, but the EBITDA margin is lower than EBIT due to adjustments, highlighting some volatility in operational efficiency.

Balance Sheet

The company's balance sheet is stable, with a debt-to-equity ratio of 0.32, indicating moderate leverage. The return on equity for TTM is 13.27%, reflecting efficient use of equity. However, the equity ratio of 3.72% shows a heavy reliance on liabilities, which could pose risks if market conditions change. Overall, the balance sheet suggests a well-managed but highly leveraged financial structure.

Cash Flow

The cash flow statement highlights strong free cash flow generation with a favorable operating cash flow to net income ratio of 1.09 for TTM. The free cash flow to net income ratio is also healthy at 1.09, indicating effective cash management. However, the decrease in free cash flow compared to previous periods reflects in the score, suggesting potential areas for improvement in cash flow sustainability.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	41.10B	17.22B	25.27B	44.70B	64.45B	60.60B
Gross Profit	23.35B	17.22B	25.27B	44.70B	64.45B	60.60B
EBITDA	5.22B	5.93B	4.00B	3.72B	4.74B	3.82B
Net Income	3.86B	4.07B	2.87B	3.73B	3.26B	3.08B
Balance Sheet
Total Assets	814.84B	802.16B	713.23B	701.46B	630.49B	600.49B
Cash, Cash Equivalents and Short-Term Investments	25.54B	24.71B	19.38B	18.84B	17.23B	7.95B
Total Debt	9.29B	10.23B	9.65B	11.29B	9.73B	10.71B
Total Liabilities	782.15B	771.01B	683.38B	669.14B	600.00B	573.48B
Stockholders Equity	29.54B	29.54B	26.84B	29.01B	27.22B	24.03B
Cash Flow
Free Cash Flow	4.28B	4.75B	5.20B	7.05B	10.37B	9.61B
Operating Cash Flow	4.28B	4.75B	5.20B	7.05B	10.37B	9.61B
Investing Cash Flow	-103.00M	-408.00M	-786.00M	-5.49B	-11.21B	-8.20B
Financing Cash Flow	-2.71B	-2.29B	-3.55B	-620.00M	-992.00M	2.01B

Great-West Lifeco Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 54.91
• 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:GWO, the sentiment is Positive. The current price of 54.91 is above the 20-day moving average (MA) of 53.75, above the 50-day MA of 52.37, and above the 200-day MA of 50.35, indicating a bullish trend. The MACD of 0.78 indicates Negative momentum. The RSI at 63.34 is Neutral, neither overbought nor oversold. The STOCH value of 71.28 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:GWO.

Great-West Lifeco Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
GWO	76 Outperform	C$50.50B	13.72	14.19%	4.27%	15.27%	4.72%
Sector *	68 Neutral	$17.84B	12.03	10.32%	3.73%	9.70%	0.76%
MFC	―	$51.12B	13.35	11.57%	4.08%	―	―
SLF	―	$32.94B	14.33	13.38%	4.24%	―	―
FRFHF	―	$41.08B	8.20	18.70%	0.88%	―	―
IAG	75 Outperform	C$13.71B	13.84	13.43%	2.49%	-4.55%	42.41%
POW	73 Outperform	C$36.90B	13.52	12.07%	5.20%	11.56%	1.15%

Great-West Lifeco Corporate Events

Great-West Lifeco Achieves Record Base Earnings and Plans Further Share Buybacks

Great-West Lifeco Inc. reported record base earnings of over $1.1 billion for Q2 2025, marking an 11% increase from the previous year, driven by strong performance in its wealth and group benefits businesses. Despite a decline in net earnings due to business transformation charges and market challenges, the company plans an additional $500 million in share buybacks, reflecting its strong capital position and focus on growth strategies.

The most recent analyst rating on (TSE:GWO) stock is a Hold with a C$54.00 price target. To see the full list of analyst forecasts on Great-West Lifeco stock, see the TSE:GWO Stock Forecast page.

Great-West Lifeco CEO to Discuss Q2 2025 Financial Results in Virtual Chat

Great-West Lifeco announced that its President and CEO, David Harney, will participate in a virtual fireside chat with CIBC Capital Markets to discuss the company’s second quarter 2025 financial results. This event signifies the company’s commitment to transparency and engagement with stakeholders, potentially impacting its market perception and investor relations.

The most recent analyst rating on (TSE:GWO) stock is a Hold with a C$54.00 price target. To see the full list of analyst forecasts on Great-West Lifeco stock, see the TSE:GWO Stock Forecast page.

IPC Acquires De Thomas Wealth Management to Enhance Advisor Services

Investment Planning Counsel Inc. (IPC), a subsidiary of Canada Life, has announced its acquisition of the wealth assets of De Thomas Wealth Management Corp. This strategic move aims to reinforce IPC’s vision of becoming a leading destination for entrepreneurial advisors by providing enhanced tools, platforms, and support. The acquisition is expected to foster deeper relationships between advisors and clients, allowing for business growth and value capture. The transaction, anticipated to complete by the end of Q3 2025, will enable De Thomas advisors to maintain their independence while benefiting from IPC’s resources, marking a collaborative effort that honors the strengths and legacy of both organizations.

The most recent analyst rating on (TSE:GWO) stock is a Hold with a C$54.00 price target. To see the full list of analyst forecasts on Great-West Lifeco stock, see the TSE:GWO Stock Forecast page.

Great-West Lifeco to Announce Q2 2025 Financial Results

Great-West Lifeco Inc. will release its second quarter 2025 financial results on August 5, 2025, with a subsequent earnings conference call scheduled for August 6. This announcement is significant for stakeholders as it provides insights into the company’s financial performance and strategic direction, impacting its market positioning and investor relations.

The most recent analyst rating on (TSE:GWO) stock is a Hold with a C$54.00 price target. To see the full list of analyst forecasts on Great-West Lifeco stock, see the TSE:GWO Stock Forecast page.

Canada Life Reinsurance Shifts Focus to Structured Reinsurance

Canada Life Reinsurance, a subsidiary of Great-West Lifeco, announced a strategic shift by ceasing new business for its U.S. traditional life mortality risk reinsurance line to focus more on structured reinsurance markets. This decision aims to allocate more resources to structured solutions, longevity reinsurance, and catastrophe retrocession, while ensuring a smooth transition for existing clients and maintaining high service levels for its inforce business.

The most recent analyst rating on (TSE:GWO) stock is a Hold with a C$54.00 price target. To see the full list of analyst forecasts on Great-West Lifeco stock, see the TSE:GWO Stock Forecast page.

Great-West Lifeco Appoints Lindsey Rix-Broom as CEO of European Operations

Great-West Lifeco has appointed Lindsey Rix-Broom as CEO of its European operations, effective July 1, 2025. Rix-Broom, who currently leads Canada Life U.K., is recognized for her leadership and strategic focus, having driven significant growth and modernization in the U.K. market. Her appointment is part of a broader leadership transition, with David Harney taking over as President & CEO of Great-West Lifeco and Canada Life. This strategic move aims to strengthen Lifeco’s presence in Europe, particularly in the U.K., Ireland, and Germany, as the company continues to focus on delivering sustainable growth and value.

The most recent analyst rating on (TSE:GWO) stock is a Hold with a C$54.00 price target. To see the full list of analyst forecasts on Great-West Lifeco stock, see the TSE:GWO Stock Forecast page.

Great-West Lifeco Elects Full Slate of Directors, Ensuring Leadership Stability

Great-West Lifeco announced the election of all 19 director nominees during its Annual and Special Meeting of Shareholders. The election results showed strong support for the nominees, indicating stability and continuity in the company’s governance. This decision is expected to reinforce Great-West Lifeco’s strategic direction and maintain its robust position in the financial services industry, benefiting stakeholders by ensuring consistent leadership.

Great-West Lifeco Reports Strong Q1 2025 Results with Focus on U.S. Growth

Great-West Lifeco reported strong first quarter 2025 results, with base earnings of $1.0 billion, marking a 5% increase from the previous year, driven by growth in its Retirement and Wealth businesses. Despite a 17% decline in net earnings from continuing operations due to unfavorable market conditions, the company maintained a robust capital position with a LICAT ratio of 130% and continued its strategic focus on capital-efficient growth, particularly in the U.S. segment, which contributed significantly to its performance.