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SD: Sounds like you have a clear strategy here. :) The good news is the divi looks like it's well covered for some time to come. That's good news for us all as we go forwards. I'm continuing to re-invest the divis and buy on the dips. Difficult to know for absolute surety if were heading for a full bloodied recession or stagnation and even if we do what impact that would have on SP hence no one strategy can be foolproof.
I would say the share price rise is definitely nothing to do with upcoming dividend. Risen to far for that.
Phyl
Will only sell the ones in my sipp. The ones in my isa and general account are in to big profit and are hence paying major dividends.
The ones in my SIPP may sell but set a high price.
Not even sure I want to buy back.
Beginning to think the rotation to value has plateaued. Depends I suppose on how high Interest rates go.
Have a hangover so thinking is hurting.
SD: Interesting strategy and one that works for you and I hasten to add a lit of others whom have previously posted on this board. I'm still building my holding in LGEN and will likely opt to have my dividends paid in additional shares as per previous divi payments. Interesting to hear other board members strategy/thoughts on what is a fairly quiet board for the size of company.
"BOFA SAYS LEGAL AND GENERAL DIVIDEND 'SHOULD NOT BE IN ANY DANGER'
(Sharecast News) - Analysts at Bank of America Securities reiterated their 'buy' recommendation for shares of Legal&General following the financial services outfit's latest half-year update.
In particular, they highlighted the group's record Solvency II ratio, telling clients that "even a severe credit cycle (if one arose) should not threaten its share count or dividend."
"Even in a severe shock, L&G's Solvency position should be robust and the dividend should still be covered. The dividend should not be in any danger," they explained.
Its dividend was much better covered by cash generation, they added, and the pension risk transfer market was accelerating, so that volumes were set to rise with higher rates providing margins with a tailwind.
They estimated that the company's dividend was set to average 63% of cash generation over 2022-24, versus a payout ratio closer to 93% over 2013-19.
"This is not appreciated and deserves a re-rating, in our view. Excess cash provides optionality but is unlikely to lead to buybacks near-term," the analysts argued.
The target price for the shares was also bumped up from 310.0p to 315.0p."
Not very generous with the target price!
Still moving in the right direction.
Last final dividend Sold the day before exdivided bought back exdivided 15p cheaper. Toped up in my sipp at 241p just because they were cheap. May do the same again but set a really greedy sell and buy back. They drifted after the final dividend. As I have some on 75% gain (god knows what the dividend percentage is) in my isa and general account. If it doesn't bite I will buy something else. Really like the private equity investment trusts at the moment.
cherryburn: agreed. Wished I'd put my life savings into this. Great, solid business and for a change to most companies I'minvested in, very well run from the top.
And a reasonable buy at 16.35 yesterday amounting to £10 million. For an income portfolio wrapped in an ISA , LGEN looks like a core hold.
Yes aviva slightly outperformed percentage wise, but i have twice as much invested with lgen, so bigger gain cashwise
So very pleased with both, now more of the same please, nice to see things going in our favour for a change guys
Aviva up 12%?
SD According to my FT feed it's 1.677, but that does not invalidate my point, beta shows the volatility of an individual share relative to the FTSE, that volatility does NOT mean that it doesn't track , merely that it overreacts. The chart referenced in my 07.08 post shows a correlation between LGEN and FTSE going back 5 years which shows a correlation of remarkably close to 1 .
casapinos
So I assume you agree with me that legal and general have a beta of 1.5!!
Casapinos, everyone is entitled to their opinion. Technically you may be wrong but in reality you may have a point....and you argue your point well. I appreciate such discussion because it is a cut above the norm.
It would be really good to see LGEN less regulated but equally we all know the danger of cutting red tape to much. The management seem to be doing a good job and are well respected.....if the regulators allow them to do their job better & easier then that should benefit shareholders.
Whilst I agree that LGEN is, in the main, an income stock, in my experience I have turned it into one of my best growth stocks over the many years I’ve held, simply by reinvesting the dividends.
One other snippet this am supports my assertion that yesterdays cool market reaction was due to the fall in assets from the FT report on the results
"Elsewhere, L&G’s investment management arm enjoyed record first-half inflows of £65.6bn, but its assets under management fell in choppy markets to £1.29tn from £1.33tn, weighing on profits. "
Full article at
https://www.ft.com/content/97114ca5-ee35-4297-9935-7b5b7f6ca44d
for those with access.
OK my description of LGEN as a "FTSE tracker" hasn't gone down well, so let me explain in more detail what I mean.
The nature of Uk banks and insurers and the stringent solvency conditions they operate under since the GFC, mean that the need to hold very large quantities of assets to meet the strict solvency criteria put in place as a result, because those assets are required to be liquid , ie easily sold in an emergency , they consist primarily of equities and tradeable bonds. They are proscribed from investing in long -term high-value infrastructure projects and are expected to hold much of their portfolio in sterling - denominated assets, to eliminate FX risk. If you've read any of NW's oft quoted comments you will be aware that the current regime put in place largely by the EU, with UK support, and at a time of maximum anxiety post the GFC is seen by many as too restrictive. The Uk Gov has just published an exploratory paper see
https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/1071899/20220328_Review_of_Solvency_II_Consultation.pdf
Outlining some proposals to ease this regime, if you don't want to read the whole doc , paras 3.1 and 4.3 summarise the easements proposed which will allow a wider range of assets to be held as collateral, until that legislation is agreed upon and enacted Insurers and banks with huge quantities of liquid assets on their books will continue to respond disproportionately to sharp moves in the FTSE , hence my comment about being a FTSE tracker, indeed I should have said " a leveraged FTSE tracker ". Next time there is a sharp move in the FTSE have a look at the reaction of bank and insurance shares to prove my point.
Remeber I am a holder here! so my point was not a negative merely a reflection of reality.
Casapinos - I too took exception to your "ftseTracker" comment, but looks like most posters beat me to it.
You really underplayed the quality of this company, and the ever expanding income streams from which it draws.
PS. I wish Nige could take the helm at my other FTSE holdings.
:)
LGEN has many strings to it's bow. All seem to be operating well. Good to see a boring defensive stock continue to churn out real returns for it's shareholders. Might not be as exciting as growth stocks but a business that's going to be around for a very long time.
My thoughts also RogueRiver. JPM and Barclays guided only yesterday - and today's results won't have affected things - to circa 350p, and today the sp hardly moves. Who the hell is selling and why ?!!
Another sound set of results with a great dividend yield. Always wonder why these trade in such a narrow band. Happy to hold and added some more in the 230s recently.
The trot.... I didn't say that the assets belong to the shareholders, my point was that the asset values had fallen due to the fall in equity and bond prices and thus the solvency cover will have diminished, without digging I don't know if it is near the limits imposed by the PRA , but clearly solvency rules might have an impact on the amount of new business the company can write.
in addition the yield on Lgen is far greater than the ftse 100 yield
I've held LGEN for a while now and love this share for the divi. Its laggardly sp does make you wonder, though, if the market cap will ever take off anywhere near those circa 400p projections.
cas
''but holders here must accept that they are essentially investing in a FTSE tracker''
NO, I don't accept it.
How 99 other businesses are run with resulting profitability or lack of, has nothing to do with how LGEN is run.
There are businesses in the ftse 100 where their share price will outperform or under-perform the percentage movement in the index.
Lgen has gone up about 13% since my purchase on 13th June - the Ftse 100 has not.