FTSE 100 Dividend Star Again Tops AJ Bell’s Most-Bought Stocks
Legal & General has topped Filmogaz.com’s most-bought stocks list for another month. Shares represented 3.92% of reported buys, narrowly ahead of BP at 3.88%.
The insurer’s share of purchases was almost double that of Rolls-Royce. Despite this popularity, the stock’s one-year total return including dividends came in at roughly 35%.
Why investors keep buying
The company dates back to the 1830s and remains a household name in pensions and life insurance. That familiarity helps explain steady retail interest.
As a FTSE 100 dividend star, it often appears among most-bought stocks. A consistently high yield keeps it front of mind for income investors.
Dividend profile and guidance
Legal & General’s forward yield sits near 8.5%. That is the highest level across the FTSE 100 and well above the index average of about 3%.
The group has paid dividends for 42 years. Management has guided 5% dividend growth for 2024, followed by 2% annual growth from 2025 to 2027.
Recent results and capital actions
Latest full-year figures showed core operating profit up about 6% and EPS rising roughly 9%. The board announced a £1.2bn buyback, the largest in the group’s history.
Its Solvency II ratio stands around 210%, giving the company considerable capital headroom. Reported profits were affected by market swings, which distorted the trailing P/E.
Valuation
On forward estimates, the shares trade at about 11 times earnings. That levels the stock with mature financial peers rather than high-growth names.
Risks and alternatives
Dividends make up a large share of reported earnings. That concentration raises the risk that a profit setback could pressure payouts or leverage.
The insurer is also exposed to global market moves. Investors should therefore consider holding the stock within a diversified portfolio.
- BP delivered roughly a 70% price rise over the past year.
- Peers such as Rolls-Royce and Shell also outperformed L&G over the same period.
- Alternatives to consider include Standard Life and M&G.
Legal & General’s high yield explains why it tops many retail lists. Still, potential buyers should weigh yield against the company’s market sensitivity and earnings mix.
