Key Highlights

  • Legal & General Group plc (LSE:LGEN) said in August that full-year core operating EPS growth should exceed the top of its 6% to 9% target range.
  • First-half core operating profit rose 7% to £918 million and core operating EPS rose 11% to 12.15p.
  • The FTSE 100 insurer is running a £1.2 billion buyback, with about £450 million done by the end of July, and aims to return over £5 billion in 2025 to 2027.
  • The Solvency II coverage ratio was 201%, above its 160% to 190% operating range.
  • The FTSE 100 closed up 1.02% at 10,782.87 on 9 November 2026.

Why Legal & General (LSE:LGEN) Is in Focus Today

Legal & General Group plc (LSE:LGEN), the FTSE 100 insurer and asset manager, is in focus on Monday 9 November 2026 as financial stocks rebounded with the index, which closed up 1.02% at 10,782.87. The shares trade around 300p, with a Market Value of roughly £16.5 billion and a steadily shrinking share count as Buybacks continue.

Investors are weighing strong Earnings momentum and generous Capital returns against a valuation that some Brokers regard as full, including a Jefferies underperform rating.

First-Half Results

On 5 August, L&G reported core operating profit of £918 million, up 7% and 3.8% ahead of consensus, and core operating EPS up 11% to 12.15p. Management said it now expects full-year core operating EPS growth above the top end of its 6% to 9% range. IFRS profit before tax was £1,997 million, boosted by a gain on the disposal of its non-retained US business.

Solvency II operational surplus generation was £790 million, up 3%, or 14.16p per share, up 7%. The Interim Dividend rose 2% to 6.24p.

Asset Management Shines

Asset Management was the standout division. Fee-related earnings jumped 37%, core operating profit rose 10% to £222 million, annualised net new Revenue reached a record and the cost-income ratio fell to 71%. About 95% of workplace Assets are now managed internally, and a private markets access fund has passed £3 billion.

Institutional Retirement, the largest unit, generated core operating profit of £646 million, and Retail rose 5% with workplace pension net flows up 35% to £6.2 billion.

Capital Returns and Solvency

The group is on track to return more than £5 billion to shareholders over 2025 to 2027, including a £1.2 billion buyback launched in March, of which about £450 million had been completed by July. The number of shares in issue has fallen to about 5.4 billion from roughly 5.7 billion a year earlier.

The Solvency II ratio was 201%, or 209% pro forma after Debt refinancing, comfortably above the 160% to 190% operating range, and management said it intends to let the ratio trend into the range as capital is deployed. Asset optimisation guidance was raised to more than £400 million a year.

Takeover Chatter and Strategy

In May, press reports said that potential bidders had been examining the group, and the chief executive denied any sale plan. The shares jumped on the report but the group has since focused on its strategy of being simpler and more focused, concentrating on asset management and retirement.

Management reiterated a target of 5% to 7% compound growth in operating profit and expects the dividend to be covered by core operating EPS this year, with improving coverage in 2027.

Risks and Valuation

Risks include Credit and longevity assumptions in pension risk transfer, lower-than-expected asset management flows and market volatility. Some analysts argue that the income appeal is deteriorating and that a valuation reset may follow, with the Jefferies target well below the share price.

Supporters point to improving dividend cover, strong capital and the earnings upgrade as reasons to expect further progress.

Business Model Overview

L&G operates in three broad areas: Institutional Retirement, which writes pension risk transfer and Annuity business, Asset Management, which runs public and private market strategies, and Retail, which includes workplace pensions and individual protection and savings. The combination provides recurring income, capital generation and exposure to long-term demographic trends.

The group has simplified its structure by disposing of its US protection business, redirecting capital into higher-return activities and Shareholder distributions.

What Investors Are Watching Next

Attention will focus on the progress of the £1.2 billion buyback, quarterly updates and any further news on asset optimisation or acquisitions. Full-year 2026 results are expected in the new year and should detail 2027 targets.

Interest rates, credit spreads and Equity markets will influence capital and fees. The pace of pension risk transfer deals and workplace pension flows will also be closely tracked.