Stock of the week: Legal & General
This week’s share of the week is Legal & General, a multinational financial services company. Its products and services include life insurance, general insurance, pensions and investment management.
The group is well positioned to benefit from an increasing demand for pensions, protection and savings plans as reliance on the state in years to come remains questionable.
Key long term factors driving the business forward are an ageing society, globalisation of asset markets, welfare reform and the adoption of digital platforms. These should be unaffected by Brexit.
The group’s latest update showed that five out of six divisions increased operating profit and while the stock market selloff towards the end of 2018 saw the shares pull back, with a PE ratio of 7.5x and a dividend yield in excess of 7%, the shares once again look attractive.
We recommend the shares a ‘buy’ for investors seeking income and willing to accept a medium level of risk.”