Legal & General Group (LGEN) — Company Research

Last Updated: 10 June 2026

Legal & General Group is a FTSE 100 financial services group founded in 1836, built around three businesses: Institutional Retirement (the UK's leading pension risk transfer writer), Asset Management (£1.2 trillion of global AUM including a fast-growing private markets arm) and Retail (protection, workplace pensions and individual annuities for around 12 million customers). 2025 marked a strategic reset completed: the US protection and US PRT businesses were sold to Meiji Yasuda for $2.3bn, core operating profit rose 6% to £1,623m, and the group launched the largest buyback in its history at £1.2bn. Track LGEN on our Live Charts, watch scheduled market events on the Economic Calendar, and share your view in the Forum.

1. Company Snapshot

Field	Value
Company	Legal & General Group Plc
Ticker	LGEN (London Stock Exchange); LGGNY (US ADR)
Exchange	London Stock Exchange — FTSE 100
Sector	Finance & Banking — life insurance, retirement and asset management
Group CEO	António Simões (since January 2024)
Share price	269.9p (close, 9 June 2026)
Market capitalisation	~£14.8bn (June 2026)
FY2025 revenue (IFRS total revenue, continuing operations)	£10,462m
FY2025 core operating profit	£1,623m (up 6%)
FY2025 IFRS profit after tax (equity holders)	£592m
FY2025 basic EPS	9.99p (core operating EPS 20.93p)
FY2025 dividend per share	21.79p (yield ~8.1% at current price), plus £1.2bn buyback
Assets under management	~£1.2trn (31 Dec 2025), including £75bn private markets
Solvency II coverage ratio	210% pro forma (FY2025, allowing for Meiji Yasuda deal and £1bn buyback)
Contractual service margin (CSM)	£12.4bn (store of future profit £13.3bn)
Employees	~11,139
Headquarters	One Coleman Street, London, UK

2. Bull and Bear Case

Bull Case

• PRT market leadership: L&G wrote £11.8bn of global pension risk transfer in 2025 (£10.4bn in the UK) and Institutional Retirement profit rose 6% to £1,168m, in a structurally growing market where most UK defined benefit schemes are still to insure their liabilities — with around 80% of UK PRT volumes coming from existing Asset Management clients.
• Heavyweight capital returns: A 21.79p dividend (~8% yield) plus the largest buyback in the group's history (£1.2bn in 2026) equals ~£2.4bn of planned shareholder returns in a year, within a stated ambition to return more than £5bn over 2025–2027 — over a third of the current market cap within three years.
• Simplified, sharper group: The $2.3bn Meiji Yasuda sale (completed 2 February 2026) exited subscale US insurance, generated £1.2bn of Solvency II capital and an expected IFRS profit of over £1.3bn, brought a 5% strategic shareholder on board, and leaves three focused divisions with clear synergies.
• Asset Management inflection: Private markets AUM grew 32% to £75bn, annualised net new revenue turned positive (£34m) and the average fee margin expanded to 9.1bps — early evidence that the lower-margin index-heavy LGIM model is being remixed toward higher-fee growth areas.
• Large store of future profit: The £12.4bn contractual service margin plus risk adjustment (£13.3bn in total) under IFRS 17 represents booked-but-unrecognised profit that will amortise into earnings over decades, underpinning the 6–9% core operating profit and EPS growth targets.

Bear Case

• IFRS earnings volatility: Reported profit remains hostage to investment variance — a £771m negative swing in 2025 left IFRS profit after tax at £592m versus £1,623m of core operating profit, and 2024's statutory result was just £191m; investors must trust management's "core" lens.
• Solvency headroom reduced: The pro forma Solvency II ratio fell from 232% to 210% after funding the buyback and absorbing the US disposal, and heavy annuity writing consumes capital — persistent sub-par markets or wider credit spreads would squeeze the surplus that funds the ~8% yield.
• Revenue drifting, not growing: IFRS total revenue on a continuing basis slipped from £10,657m to £10,462m in 2025 and the dividend now grows at only 2% a year, so the investment case leans heavily on buybacks and the CSM unwind rather than organic top-line growth.
• Annuity balance-sheet risk: Returns depend on a vast credit portfolio backing long-dated annuity liabilities; downgrades or defaults in a recession, adverse longevity developments, or aggressive PRT pricing from competitors (Rothesay, PIC, Aviva, Standard Life) could erode margins on decades-long contracts.

3. Business Segments

L&G reports through three divisions plus a corporate centre. Percentages below are shares of FY2025 IFRS total revenue of £10,462m (Retail combines the "Insurance" and "Retail Retirement" revenue lines); core operating profit (COP) contributions are shown in the description.

Segment	% of revenue	What it is
Institutional Retirement	~54%	UK and international pension risk transfer (bulk annuities) — taking over corporate defined benefit pension obligations and the assets that back them. Revenue of £5,643m and COP of £1,168m in 2025 (up 6%), with £11.8bn of global new business volumes.
Retail	~37%	UK protection (life insurance), workplace pensions (DC assets £114bn, up 21%), individual annuities (£1.8bn of 2025 volumes) and US-linked retail lines. Combined revenue of £3,866m and COP of £447m in 2025 (up 4%), serving ~12 million customers.
Asset Management	~11%	Global asset manager spanning index, active fixed income and £75bn of private markets (real estate, infrastructure, private credit). Total revenue of £1,106m including internal mandates (£879m external) and COP of £402m in 2025; £1.2trn AUM with 9.1bps average fee margin.
Corporate centre & eliminations	~-2%	Group debt costs (£229m in 2025), investment projects and expenses (£165m) and inter-segmental eliminations; not a customer-facing business.

4. Business Model & Moat

How it makes money. L&G operates a synergistic flywheel: Institutional Retirement takes on pension liabilities for an upfront premium and earns a spread by investing those assets — largely through its own Asset Management division — in credit and private assets; Asset Management earns fees on £1.2trn of internal and external money; and Retail collects insurance premiums and pension contributions that feed both. Under IFRS 17, each new annuity deal adds to a £12.4bn contractual service margin that converts into operating profit over the life of the contracts, giving unusually high earnings visibility.

Unit economics. UK PRT was written at low capital strain in 2025 (under 4% of premium), meaning every £10bn of new business consumes only a few hundred million pounds of capital while locking in decades of spread income; Solvency II operational surplus generation of £1,530m comfortably covered the ~£1.25bn dividend cost. In Asset Management, index management is low-fee but sticky and feeds the annuity engine, while private markets earn multiples of the group's 9.1bps average fee margin.

Moat. Scale, brand and the in-house investment engine are the moat: L&G is the UK's largest PRT writer with around 80% of volumes transacted with long-standing Asset Management clients, one of the world's largest index managers, and a top workplace pension provider — positions reinforced by regulatory capital requirements, actuarial data accumulated over 189 years, and trustee relationships that take decades to build.

5. Financial Health

All figures are taken from L&G's results announcements and Annual Report and Accounts. "Revenue" is IFRS total revenue as disclosed in the group's segmental analysis (insurance revenue, fund management and investment contract fees and other operational income). L&G adopted IFRS 17 from 2023 (2022 restated); 2021 was reported under IFRS 4, and the 2022 restated revenue disclosure is not on a comparable footing, so those cells are marked n/m. 2023 revenue is as reported at the time and includes the US businesses sold in 2026; 2024 and 2025 are on the re-presented continuing-operations basis, so the 2024 change is also marked n/m. "Adjusted EPS" is L&G's core operating EPS, a measure introduced with the 2024 results (2024 figure restated to exclude the non-retained US business). For context, IFRS profit after tax attributable to equity holders was: 2021 £2,050m (IFRS 4), 2022 £783m (restated), 2023 £457m, 2024 £191m, 2025 £592m.

Year	Revenue (£m)	YoY %	GAAP EPS (p)	Adjusted EPS (p)	Dividend/share (p)	Long-term debt (core borrowings, YE, £bn)
2021	n/m (IFRS 4 basis)	n/m	—	—	18.45	—
2022	n/m (IFRS 17 transition)	n/m	—	—	19.37	4.3
2023	12,111	n/m	7.35	—	20.34	4.3
2024	10,657	n/m (US re-presented)	2.89	19.20	21.36	4.3
2025	10,462	-1.8%	9.99	20.93	21.79	4.3

Core borrowings have been held steady at ~£4.3bn for four consecutive year-ends (£4,297m at 31 December 2025, of which £3,697m subordinated and £600m senior), with a further £0.3bn of operational borrowings at end-2025, down from £1.7bn a year earlier. The low 2024 GAAP EPS reflected heavy negative investment variance under IFRS 17 rather than operating weakness — core operating profit grew through the period: £1,667m (2023, prior "operating profit" definition), £1,534m (2024, restated core basis) and £1,623m (2025).

L&G reports semi-annually, so the table below shows half-year periods, most recent first. H2 figures are derived as full-year minus first-half disclosures; L&G does not disclose IFRS revenue by half-year on the continuing-operations basis, so half-year revenue cells are marked n/d.

Quarter / Half	Revenue (£m)	Core operating profit (£m)	IFRS profit after tax (£m)	Adjusted EPS (core operating, p)
H2 2025	n/d	764	276	9.99
H1 2025	n/d	859	316	10.94
H2 2024	n/d	725	(32)	9.13
H1 2024	n/d	809	223	10.07
FY 2025	10,462	1,623	592	20.93

6. Valuation

Raw metrics, June 2026. Not opinions on whether the stock is cheap or expensive.

Metric	Value
Market cap	~£14.8bn (269.9p, 9 June 2026; ~5,484m shares, shrinking as buyback shares are cancelled)
Enterprise value	~£19.1bn on a crude basis (market cap ~£14.8bn + £4.3bn core borrowings per the FY2025 balance sheet; group cash largely backs policyholder and annuity liabilities so is not netted off)
Trailing P/E (GAAP)	~27x (269.9p / FY2025 basic EPS of 9.99p); on core operating EPS of 20.93p the equivalent multiple is ~13x
P/E (forward)	Not published — ChartsView does not use analyst estimates; management targets 6–9% compound annual growth in core operating EPS over 2024–2027
P/S (TTM)	~1.4x (market cap ~£14.8bn / FY2025 IFRS total revenue of £10,462m)
EV/EBITDA (TTM)	Not meaningful for a life insurance and retirement group under IFRS 17 — there is no conventional EBITDA; the operating-performance equivalent is core operating profit of £1,623m (FY2025)
P/FCF	Statutory cash flow is dominated by policyholder and annuity fund movements, so P/FCF is not meaningful; the closest analogue is price / Solvency II operational surplus generation of ~10x (market cap ~£14.8bn / FY2025 OSG of £1,530m)
52-week high	300p (LSE, 12 months to 9 June 2026)
52-week low	217p (LSE, 12 months to 9 June 2026)
Dividend yield	~8.1% (21.79p on 269.9p), before the effect of the £1.2bn 2026 buyback
Short interest (% of float)	~1.5% disclosed via the FCA short-disclosure regime (positions ≥0.5%: GLG Partners 0.88% as at 8 June 2026 and Numeric Investors 0.62% as at 27 May 2026; ShortTracker/FCA data)
Days to cover	Not published for LSE-listed stocks — the UK regime discloses individual short positions above 0.5% rather than exchange-wide short interest

7. Growth Drivers

The core growth engine is pension risk transfer. UK defined benefit schemes hold well over £1 trillion of liabilities, the majority not yet insured, and improved funding levels keep pushing schemes toward buyout; L&G wrote £10.4bn of UK PRT in 2025 within an £11.8bn global total, and is expanding the same playbook internationally through reinsurance partnerships (including with Meiji Yasuda, which now owns 5% of the group and provides a corridor into Japanese and US flows). Each pound of new PRT also feeds Asset Management, which manages the backing assets.

The second driver is the remix of Asset Management toward higher-fee strategies: private markets AUM rose 32% to £75bn in 2025 with an ambition to reach £85bn by 2028, annualised net new revenue is positive and the average fee margin is expanding from a low base (9.1bps). Third, Retail rides the defined contribution boom — workplace DC assets grew 21% to £114bn with £6.2bn of net flows and a further £3.7bn won for 2026 onboarding, while a 15% rise in workplace members buying an L&G annuity shows the cross-sell loop working. Management targets 6–9% compound core operating EPS growth to 2027, £5–6bn of cumulative Solvency II operational surplus generation, and more than £5bn of shareholder returns over 2025–2027.

8. Peer Comparison

L&G's closest comparators are the other large UK life, retirement and savings groups.

Peer	Market cap (June 2026)	Key 2025 metric
Aviva	~£18.2bn	FY2025 group operating profit £2,203m, up 25% (including first Direct Line contribution), hitting its £2bn target a year early
M&G plc	~£7.6bn	FY2025 adjusted operating profit £838m with £7.8bn net inflows from open business and a 242% Solvency II ratio
Phoenix Group (renamed Standard Life plc, March 2026)	~£7.4bn	~12 million customers and £295bn+ of assets under administration; H1 2025 adjusted operating profit up 25%
Schroders	~£9.1bn	FY2025 AUM record £823.7bn with £11.2bn net new business; adjusted operating profit £756.6m, up 25%

9. Insider Activity

L&G is led by Group Chief Executive Officer António Simões. UK PDMR disclosures (RNS) in 2026 show routine dividend reinvestment and a family transfer rather than open-market selling:

Name	Date	Type	Shares	Price	Value	Plan Type
António Simões (Group CEO)	26 Mar 2026	Transfer of shares to spouse (nil consideration; aggregate beneficial holding unchanged)	188,097	nil	—	Personal transfer
Various Directors/PDMRs (including Group CFO and Group COO)	4 Jun 2026	Dividend reinvestment purchases	—	~£2.71	—	Employee Share Plan DRIP

Separately, the company itself is the largest buyer of its own shares: 6,188,720 ordinary shares were repurchased for cancellation between 1 and 5 June 2026 alone under the £1.2bn buyback programme, and Meiji Yasuda holds a 5% strategic stake following completion of the US transaction.

10. Key Risks

• Credit cycle exposure (Market): Annuity liabilities are backed by a vast bond and private credit portfolio; a recession bringing downgrades and defaults would hit both IFRS results and Solvency II surplus, and investment variance already swung reported profit by hundreds of millions in 2024–2025.
• Capital and solvency headroom (Financial): The pro forma Solvency II ratio of 210% is down from 232% after the buyback and US disposal; sustained heavy PRT writing, market stress or regulatory recalibration (Solvency UK reforms) could constrain the pace of shareholder returns.
• Longevity and assumption risk (Operational): Decades-long annuity contracts rest on mortality, inflation and matching-adjustment assumptions; adverse longevity developments or assumption changes can require reserve strengthening years after business is written.
• PRT competition and pricing (Competition): Rothesay, PIC, Aviva, Standard Life and new entrants are all chasing the same UK buyout pipeline; aggressive pricing could compress new-business margins exactly as volumes become central to the growth story.
• Asset Management turnaround execution (Execution): The fee margin is only 9.1bps and ANNR of £34m is small against a £1.2trn book; if private markets growth stalls or index mandates reprice, divisional profit (£402m, flat in 2025) could disappoint against the inflection narrative.
• Policy and regulatory change (Regulatory): Pensions policy (DC consolidation, Mansion House reforms), FCA conduct rules and IFRS 17 interpretation changes can alter the economics of workplace pensions, annuities and fee structures with little notice.

11. Recent Developments

• 8 Jun 2026 — Buyback rolls on. L&G disclosed the repurchase of 6,188,720 ordinary shares between 1 and 5 June 2026 at roughly 268–272p through Barclays Capital, all for cancellation, as the £1.2bn 2026 programme launched in March continues to shrink the share count; PDMRs also reported routine DRIP purchases at ~£2.71.
• 4 Jun 2026 — Final 2025 dividend paid. Shareholders received the 15.67p final dividend (full-year 21.79p, up 2%), with the next (interim) dividend timetable already set for August–September 2026.
• 21 May 2026 — AGM and capital reduction vote. The 2026 AGM in London was accompanied by a general meeting approving a capital reduction, a technical step supporting distributable reserves for future returns.
• 11 Mar 2026 — Full Year 2025 results. Core operating profit of £1,623m (up 6%), core operating EPS up 9% to 20.93p, IFRS profit before tax of £807m, pro forma Solvency II of 210%, and the £1.2bn buyback — the largest in L&G's history — announced alongside guidance of 2% annual DPS growth.
• 2 Feb 2026 — Meiji Yasuda transaction completed. The $2.3bn cash sale of the US protection and US PRT businesses closed, generating £1.2bn of Solvency II capital and an expected IFRS profit of more than £1.3bn; Meiji Yasuda took a 5% economic interest in L&G and the partners will pursue US PRT and global asset management flows together.

12. Key Dates

• 5 Aug 2026 — Half Year 2026 results (first results to include the full effect of the buyback and the post-US continuing-operations baseline)
• 20 Aug 2026 — Ex-dividend date for the 2026 interim dividend
• 21 Aug 2026 — Interim dividend record date
• 25 Sep 2026 — Interim dividend payment date (including reinvestment)
• Expected March 2027 — Full Year 2026 results, a key checkpoint on the 6–9% core operating EPS growth target and the £5bn+ 2025–2027 capital-return ambition

Cross-check these against wider market events on our Economic Calendar.

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