Aviva Share Discussion Threads

[1robbob] 05/1/2024 14:36

Better than no window at all!

[grahamburn] 05/1/2024 14:27

Fair comment - though it's a very small/tight window

[1robbob] 05/1/2024 14:15

grahamburn
I don't understand
Any sales would be in Tax Year 2024/2025 for CGT

[grahamburn] 05/1/2024 12:53

True.......but partially dependent on the potential CGT liability for 23/24 in a trading account which may be more than the dividend tax saved on 24/25.

[1robbob] 05/1/2024 11:08

In case you hadn’t noticed, the timetable for the 2023 Final dividend is:
Announced: 7th March
Ex Dividend: 11th April
Paid: 23rd May

So there is a window between Monday 8th April to Wednesday 10th April to use 2024/2025 ISA Allowances to transfer stock including the Final Dividend into ISAs

[whatsup32] 05/1/2024 10:30

Seller thinks it won't go any higher in value or they can reinvest proceeds elsewhere.
And buyer thinks its a great purchase and they can make tons of money out of buying.

Same as in buying and selling shares.

[makinbuks] 05/1/2024 09:52

True, but on the other hand, why would Lloyds be selling? They smell the top of the market? I'm guessing AV wont be interested as it would be capital intensive although I imagine the admin and investment synergies would be interesting adding 25% to the policy volume

[whatsup32] 04/1/2024 19:53

If the bidding next week for Scottish life annuities leads to a significant premium , it may lead to a re rating for Aviva . Scottish has 4% of life while Av has 15%


hxxps://www.coastfm.co.uk/news/business/royal-london-plots-bid-for-6bn-scottish

[smurfy2001] 04/1/2024 15:55

Labour big bang.

[whatsup32] 04/1/2024 15:48

Decent volume already over 10m . Unusual for 1st week of jan I think. Royal London influence?

[smurfy2001] 04/1/2024 12:39

Royal London plots bid for £6bn Scottish Widows book

[whatsup32] 04/1/2024 11:38

Been there done that .

[whatsup32] 03/1/2024 19:00

Market will start getting into full swing next week when mm’s and funds return from Caribbean.

[anhar] 03/1/2024 11:04

Yes AV. might be a screaming buy for income seeking PIs like me due to its high yield, though it does have a somewhat patchy divi record. In this sector LGEN divi record is better and I hold both to spread the risks. So-called screaming buys can remain that way for years in some cases. If yield was that important to the only investors who matter - institutions like pension funds etc. - such HYs from ostensibly sound companies would not exist for long.

So comparing the yields with that on the prefs or gilts and concluding that the ratios are not as they "should be" (whatever that may mean) is not imo a sound basis for PIs seeking capital growth. CG can come only from insts buying over time, not from irrelevant PI views and trades, and as I said, yields or relative yields are not the primary attraction for most of them.

Which is good for us as it creates these HY anomalies ideal for income players.

[yf23_1] 02/1/2024 19:49

I think you should be looking at the yield ratios between AV. and the prefs. The yield on AV. should be less than that on the prefs as it should encompass some future growth in divs.
So either the prefs are overrated (unlikely, as 30 yr gilts are 4.1 %) or the market is expecting a cut in dividends in future....

or AV.is a screaming buy !

[anhar] 02/1/2024 12:46

The discussion about relative yields misses the point that institutional investors, who overwhemingly own and trade the shares of big caps like AV., are only marginally concerned with divis. For the most part they are seeking long term capital growht so that the income is only a minor concern, if at all.

Yield is of far more interest to PIs, especially income investors like me. But PI views and trades are irrelevant to big cap share prices and this is why very high yields like from AV. and LGEN etc. can persist for very long periods. The insts won't buy stocks on high yields, even ostensibly sustainable HYs, just for that reason alone. Consequently the sps are not driven up because yield is not their primary criterion for investing.

For the shares to rise over time, enough of them need to decide that there is a long term investment case, with yield playing only a minor or even no role in that decision. There are a few high yield funds to whom income is of importance but generally this is not the case.

This is why PIs are so often puzzled by sustainable HYs that, for years in many cases, refuse to be driven down by share price rises. We income players benefit greatly from such situations.

[yump] 02/1/2024 12:30

Get the point about QE. I didn’t take the max ratio for that reason, as it would have put AV yield at 3x that of gilts for much of that period.

Perhaps it will just end up being a simple comparison of 7 vs 3.5, accompanied by increasing confidence that higher gilt yields are confined to the past.

[1robbob] 02/1/2024 11:08

yump

>>Yield here now 7% ish
>>Gilts 3.5%
>>Not sure the annual div increase gets the ratio back to what it was. Certainly not at 500p.

7%ish!!!...
The AV dividend for 2023 (now finished) is widely expected to be 33.4p at 430p this is a near current yield of 7.75%.

Using the data relationships you suggest (which I do not accept)
At the current gilt yield, for the AV yield to fall to 7% the share price would need to rise to 477p . .....not that far off 500p?
To reach an AV share price of 500p would require a Gilt Yield of 3.35% - a fall of under 5%, which is highly likely given the current inflation and interest rate outlook

Any analysis which relies on Gilt yield data from 2015-2020 has to be treated with the utmost suspicion. Throughout that period the BoE was heavily operating its QE Programme with the objective of artificially pushing down gilt yields

The current market yield situation of AV is totally bizarre, as compared to 10 year Gilt yields.
Gilt yield 3.50% - AV 7.75%
This suggests that a fixed income for 10 years is more than 2x+ as valuable as an income growing at 4%-7% per annum.....clearly total tosh

I totally accept that the quality of the Gilt covenant (HMG) is superior to AV and also that AV has a chequered dividend history. So a premium is undoubtedly very fair.
I would contend that a premium of 120% is now totally unreasonable

Obviously what the premium level should be is a totally subjective decision!!

I suggest that over the next 18 months, as the market gradually accepts that AV is a much changed and far better managed beast, the yield premium will move towards the 50%-75% range

At current Gilt yield levels this would give an AV price in the range of 545p-635p
Legal and General would react similarly

I CAN BUT DREAM

[yump] 01/1/2024 18:39

If you compare the ratio of dividend yield to say 10yr gilts…%

2015-2020 gilts were 1.5-2% and div yield 4-5%+. So AV approx 2x gilts or more.

Yield here now 7% ish
Gilts 3.5%

Not sure the annual div increase gets the ratio back to what it was. Certainly not at 500p.

[smurfy2001] 01/1/2024 17:40

500p would be nice was expecting that after the share consolidation if I'm being honest.

[whatsup32] 01/1/2024 14:53

1rob. Seconded.

AB has done a brilliant job delivering as promised. Ever the optimist I think Av will be bought out before AB ends her current contract. Even without t/o we’re on firm ground barring uncertainties.

Regarding claims , will I be right in assuming there wasn’t any catastrophic claims this account (floodings -Fire) . Also quotes for vehicle cover has shot up while there I suggest inflation has stabilised .

[1robbob] 01/1/2024 13:29

yump...yes
Higher dividend per share +7% in 2023 and similar likely in 2024
Wider perception of a more focused well managed Company
Acceptance that the 'new' management has done exactly what it said it would!!
Wider perception of the quality of revenues, particularly Bulk Pension Annuities and Private Health Insurance

As an aside...
I know this sounds mad
But I have a strong feeling that, with China and most Euro Economies struggling to achieve any growth whatsoever, the market will begin to once again focus on the possibility of deflation

[yump] 01/1/2024 13:18

Is there a reason why Aviva should have a higher share price this year, than it had before the interest rate rises ?