Legal & General Share Discussion Threads

[mr.oz] 06/12/2024 15:34

ffs. Good job there was a broker upgrade today

[devonbeachbum] 06/12/2024 11:56

5% this year. 2% DPS increase to 27 plus similar buybacks.

[goldgeezer] 06/12/2024 11:48

2% - I thought it was much higher

[devonbeachbum] 06/12/2024 11:33

Pierre, it may be negligible but every bit helps. Not a problem for me as I'm happy with the long term approach. And what is not spent on the 2% div and buybacks will be used for growth. The target at the Capital Markets Day was a 6-9% core operating EPS CAGR 2024-27- which definitely isn't negligible. Again, I likey a lot.

[geckotheglorious] 06/12/2024 11:27

"Berenberg: Buybacks galore at Legal & General "
Berenberg is expecting a step up in buybacks at Legal & General (LGEN) as it successfully manages ‘non-strategic assets’.

Analyst Michael Huttner retained his ‘buy’ recommendation and target price of 265p on the Citywire Elite Companies A-rated insurer, which added 1.2% to 239p on Thursday and has retreated 3.8% in 2024 to date.  

The sale of housebuilder Cala Homes for £1.35bn in September will see L&G ‘add the £100m benefit to solvency capital from this sale to the buyback it will announce at its full-year 2024 results’, lifting Huttner’s initial 2025 buyback estimate from £200m to £300m.

On top of this, he said ‘diversification measures’ at the group means there could be ‘potentially more available for distribution to shareholders’.

‘We also raise our buyback forecasts for 2026 and 2027 from £200m to £250m for both years as L&G is successfully managing non-strategic assets for value,’ Huttner said.
‘We therefore believe this means there will be more asset sales like Cala Homes, although of smaller size, which in turn will lead to more capital available for buybacks.’

[alphorn] 06/12/2024 11:12

j - well done! ;))

[jordaggy] 06/12/2024 11:11

My posts are always brilliant and as such, I've never had a down tick.

[cwa1] 06/12/2024 10:57

I think most people are aware of who the serial "down ticker" is, let's leave him to it and just get on with our own business. Thanks

[gbh2] 06/12/2024 10:43

This one of many threads the nutter spends the day by down ticking every comment :)

[hardup1] 06/12/2024 10:37

Amusing to see there is one on this chat board who disagree's with every post and downticks them all! 🙈🙉🙊

[yump] 06/12/2024 10:35

Meanwhile its clear that JP Morgan target of 295p is extremely accurate and credible and that is nothing to do with it being rhe highest.

[pierre oreilly] 06/12/2024 10:30

The eps increase for a buyback is the ratio of shares bought back to the total number of shares.

And that is usually close to zero. Yes the eps is increased, but by a negligible amount for a buyback. Do the numbers for a proposed lgen buyback.

The share price is the balance of shares (and bid price) on the buyside of the sets system to those on the sell side. Put more on the buyside settling some on the sell side and the 'market' price rises. (And put more on the sell side and the price falls).

[devonbeachbum] 06/12/2024 10:20

A share price is just a market price, that's all. But a buyback will increase the EPS while a special wont. And I think that's what Samoes is doing very nicely. I don't think he's reinvented the wheel with his restructure. But the 2% divi increase with buybacks will create more EPS each year even if there was no profit increase. It's a numbers game that he's playing well. Add in a shedload of PRT each year and the future looks very nice indeedy.

[pierre oreilly] 06/12/2024 09:57

Yes mc, you're getting into speculation (or gambling) with your views.

Separate the purely mechanical, certain, primary effect of a special v buyback.

The mechanical, certain, primary effect of a special is a net zero, due to the price being lowered by the divi amount on xd day.

The mechanical, certain, primary effect of a buyback is that millions, sometimes billions, of shares are put on the buyside (often over several months). And the certain effect of shares on the buyside is that they drive the share price up (from what it would otherwise be). That's just mechanical.

If you get into speculating what others will do around those actions, then you are just guessing or gamblimg. Others may buy or sell due to those actions, but they may not. These are secondary and not certain primary effects.

I know you'll post an example where a share with a buyback had gone down over the buyback period and one where a special divi share has gone up - but of course those examples are meaningless because they aren't a representative sample.

But I'll do it anyway!. Look at lloyds during its buyback period. Lots buy in when a massive buyback is announced due to a certainty of price rise from where it would otherwise be (which does not mean of course a certain price rise).

imv, any analysis should separate the certain mechanical effects from any perceived secondary effects.

[mcunliffe1] 06/12/2024 08:06

But, Pierre, how many would increase their holding in LGEN ahead of the Special Div. ex-div date?

Sure, the share price would fall 23p or thereabouts at ex-div but from a greater height than perhaps would have been the case without a special meaning, overall, a real benefit to holders.

All supposition.

[veryniceperson] 06/12/2024 07:57

Soon, pick up again.

[cwa1] 06/12/2024 07:26

*JPMORGAN RAISES LEGAL & GENERAL PRICE TARGET TO 295 (290) PENCE - 'OVERWEIGHT'

[pierre oreilly] 05/12/2024 22:17

If lgen declared a 23p special, then on xd day of the special the share price would drop 23p.

[bountyhunter] 05/12/2024 19:32

They could always pay a modest special while using the lion's share for buybacks.

[hardup1] 05/12/2024 18:51

I have bought in here today @ 237.8p

[tornado12] 05/12/2024 18:03

I expect it will come back to the 250p range in time for FY results on 12/3. For divi re-investors, is clear better to stay in the lower range. The divi for FY 2024 should be in region of 21,34p and then for 2025 22,43p.. Thereafter the growth is pegged back at 2% YoY (but this could be upgraded). For BB to have any meaningful impact they need to be massively scaled up. 200Mgbp is small potatoes and will not have any major influence on the share price

TBH, I also want them to focus on the EPS growth, this is really the driver to all ... GLA

[marktime1231] 05/12/2024 17:36

There are plenty of examples of that, the share price spikes and then dives off a cliff on ex-div. No thanks.

[mcunliffe1] 05/12/2024 17:27

Interestingly, I wonder how the share price would have reacted had LGEN hinted at a special dividend to be paid?

[marktime1231] 05/12/2024 17:08

I can understand private investor enthusiasm for a special even though that would be a one off. But actually I am very happy with the already splendid ordinary dividends. Analysts, brokers and institutional investors all want a meaningful buyback, which should put the share price back in healthy territory more permanently, and perhaps enhance the dampened prospects for future dividend growth. The priority for surplus capital is to provide the seed for future PRT deals and more private market investment, I think that is where Cala proceeds are mostly destined. Any spare I'm pretty sure will then go to a buyback, the hint of which is why the share price is responding so positively now.

[mcunliffe1] 05/12/2024 13:34

Or, marktime1231, that £1.35bn could be given back to us as a special dividend.

It would be worth just under 23p per share. That compares with the most recent dividend payment of almost 6p a share.

I would then be almost £4000 better off - guaranteed.

If the share price was lifted by 23p as a result of the buyback it would place the share price back where it was in the Jan - May 2024 period. That would not be guaranteed of course.

When you think the shares have gone up by approx. 6.27% in the last two trading days, based only on the recent good news why blow the money on a share BB just now? Wait to see if the share price dribbles downwards again and then buyback for more shares.