Legal & General Group Plc Raises Dividend 22% On Bumper 2013

Legal & General (LON: LGEN) saw profit and cash flow increase enabling gains in earnings per share.

| More on:

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

Pound CoinsOne of the UK’s biggest insurers Legal and General (LSE: LGEN) (NASDAQOTH: LGGNY.US) today reported a 10% rise in profits for 2013 as well as better-than-expected net cash generation.

While the dividend was hiked 22% on cash flow and profit gains, the market might have expected a larger increase and the shares fell by 2% to 235p in early trade.

Profit jumped to £1.1bn from £1bn a year earlier due to strong revenue growth and cost control. Net cash generation increased to £1bn from £865m the year before — the group notes that this is triple the figure since the financial crisis.

So far in 2014 Legal & General claims to have performed “strongly” while acknowledging broader risks to the economy and markets remain.

Last month the firm acquired the US investment adviser GIA for $50m with international inflows expected to gather pace in 2014.

The chief executive, Nigel Wilson, commented:

“We have delivered significant outperformance during lean economic times and are building momentum as the economy recovers. We now have over 10 million customers who we provide with good quality, good value products and excellent service, including through the recent floods.”

Earnings per share increased 10% to 15p while the dividend increased by a fifth to 9p per share. Therefore, after this morning’s price movement, Legal & General shares may trade on a P/E of 16 with a dividend yield equaling 3.8%.

Whether those ratings have any impact on your decision to ‘buy’ is up to you.

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be considered so you should consider taking independent financial advice.

> Mark does not own shares in Legal & General.

More on Company Comment

Aerial shot showing an aircraft shadow flying over an idyllic beach
Investing Articles

Rolls-Royce shares are trading for pennies. Should I buy them today?

Just because Rolls-Royce shares cost pennies doesn't make them cheap. Its troubles aren't over yet.

Read more »

Business development to success and FTSE 100 250 350 growth concept.
Investing Articles

8.5% and 9.5% dividend yields! 2 FTSE 100 stocks to buy today

The dividend yields at these brilliant blue-chips sit very close to double digits. I think they could be too good…

Read more »

Investing Articles

Tesco vs Royal Mail: which cheap FTSE 100 share should I buy?

The Tesco and Royal Mail share prices both seem to offer great value at recent levels. So which cheap FTSE…

Read more »

Investing Articles

2 FTSE 100 dividend-paying stocks to buy in an ISA

The deadline for new money going into Stocks and Shares ISAs is just around the corner. Here are two FTSE…

Read more »

Business man on stock market crash financial trade indicator background.
Investing Articles

2 dividend paying banking stocks to combat inflation in 2022

With inflation taking off in the US, the Fed may have to raise rates. Stephen Bhasera believes these banking stocks…

Read more »

Various denominations of notes in a pile
Investing Articles

A high-dividend stock I’d buy now

Why this high-dividend stock is potentially more than just a sleepy cash-cow business and growth looks set to kick in…

Read more »

Investing Articles

2 FTSE 100 dividend stocks I’d aim to never sell

I wouldn't try to hold all my investments forever, but these two FTSE 100 dividend stocks both have many qualities…

Read more »

Scene depicting the City of London, home of the FTSE 100
Investing Articles

With £2,000 to invest, I’d buy these FTSE 100 shares with big dividends

Several FTSE 100 shares pay out big dividends, but I'd start my research with these defensive operators in a growing…

Read more »