Legal & General Group Plc (LGEN) Stock on 3 December 2025: High‑Yield FTSE 100 Giant Between Reform, Risk and Record PRT Deals

Published: 3 December 2025

Legal & General Group Plc (LON: LGEN) is finishing 2025 as one of the most debated stocks in the FTSE 100: a near‑9% dividend yield, strong pension‑risk‑transfer (PRT) momentum, but also high leverage and a still‑unconvinced slice of the analyst community.

As of the London close on 3 December 2025, Legal & General shares changed hands around 248p, within a 52‑week range of 206.8p to 266.2p and with a sell/buy quote of roughly 248.3p/248.5p. That leaves the stock mid‑range in its one‑year band and modestly up on the year, with a market capitalisation just under £14bn. ^[1]

Below is a roundup of the latest news, forecasts and analysis as of 3 December 2025 — the stuff currently shaping sentiment on LGEN.

Share price snapshot and recent performance

Hargreaves Lansdown data show Legal & General’s: ^[2]

Close on 3 December 2025: c. 248p
Intraday range: roughly 244.5p–252.1p
52‑week range: 206.8p–266.2p
Dividend yield (historic): about 8.6%
P/E ratio (trailing IFRS): ~86x

Danelfin, which tracks European equities, shows similar headline numbers: a share price around 246p on recent data, market cap of about £13.7bn, a trailing dividend yield of 8.76% and a year‑to‑date total return of just over 7%. ^[3]

On shorter time frames, Hargreaves Lansdown reports that the shares are up around 4–6% over one to three months and just under 11% over one year, lagging some peers like Aviva but still comfortably positive. ^[4]

So the market is currently paying you close to 9% a year in cash dividends to hold a stock that has delivered mid‑single‑digit capital gains over 2025 — an income investor’s ears understandably perk up at those numbers.

Dividend yield: income engine with a complicated payout ratio

On the income front, Legal & General remains one of the FTSE 100’s heavyweight yielders:

MarketBeat calculates a dividend yield of 8.58%, based on an annual dividend of 21.36p per share. ^[5]
Danelfin’s numbers land essentially in the same ballpark at 8.76%. ^[6]

The quirk: MarketBeat also estimates a dividend payout ratio of nearly 479% of IFRS earnings, but only about 5% of cash flow, underlining how opaque accounting profits can be for life insurers under IFRS 17. ^[7]

From the company side, August’s half‑year results showed: ^[8]

Core operating EPS: up 9% to 10.94p
Core operating profit: £859m, up 6%
Solvency II coverage ratio: a robust 217% after allowing for the £500m buyback
Interim dividend: 6.12p, up 2% year‑on‑year

Management reiterated a three‑year plan to return over £5bn to shareholders via dividends and buybacks, a message CEO António Simões has repeated in interviews. ^[9]

The high headline payout ratio therefore isn’t a sign that the company is literally paying out five times what it earns in “real” money — it’s a sign that accounting profit and economic cash generation diverge sharply in this sector. The sustainability question hinges more on capital generation and solvency than on textbook P/E maths.

Core business momentum: half‑year results and structural growth story

The August 2025 half‑year update painted the picture of a business leaning hard into its strengths: ^[10]

Global PRT volumes (H1 plus deals signed or in exclusivity): £5.2bn
IFRS profit before tax: £406m, up 28%
Contractual Service Margin & Risk Adjustment (future profit store): up to £13.1bn
Private markets assets under management: £65bn

The company also highlighted significant progress against its strategic refocus:

Agreed sale of the US protection business and broader partnership with Meiji Yasuda for $2.3bn. ^[11]
Acquisition of Proprium Capital Partners, strengthening its global real‑estate and private‑markets platform. ^[12]
A private credit partnership with Blackstone that could see up to $20bn of annuity‑backing assets channelled into investment‑grade private credit by 2030, with £1–1.5bn a year of new flows over the next five years. ^[13]

In October’s Retail Investor Deep Dive, the group drilled down further into the growth plan for its retail arm: ^[14]

The Retail business serves 12.4m UK customers across workplace pensions, annuities, lifetime mortgages and protection.
L&G manages over £300bn of retail wealth and more than £200bn in DC assets, making it the UK’s largest DC asset manager and annuity provider.
Management set two key 2024–28 targets for Retail:
- £40–50bn of Workplace DC net flows over the period.
- 4–6% compound annual growth in Retail operating profit.

Those retail and DC flows are expected to contribute more than 40% of Asset Management’s cumulative net new revenue target for 2025–28, pointing to a strategy where bulk annuity deals, retail savings flows and private‑markets asset management are all meant to reinforce one another.

Big PRT news: Ford’s £4.6bn buy‑in

One of the most eye‑catching headlines in 2025 for Legal & General was the completion of a £4.6bn buy‑in with two Ford Motor Company pension schemes in October. ^[15]

Key details:

It covers more than 35,000 members of Ford’s UK defined‑benefit schemes. ^[16]
It is the largest UK pension risk transfer transaction announced in 2025 and L&G’s second‑largest buy‑in ever by premium size. ^[17]
The deal lifts L&G’s global PRT volumes for 2025 to around £11bn year‑to‑date, underlining the continued strength of this market. ^[18]

This is the part of the business that bulls love: long‑dated, capital‑heavy liabilities matched by assets where investment skill matters, in a market with high barriers to entry. It also explains why regulators and ratings agencies obsess over capital strength and stress tests.

Regulatory backdrop: stress tests supportive, but scrutiny is intense

In November, the Bank of England published results of its latest life‑insurance stress test under the new “Solvency UK” framework. The Prudential Regulation Authority said all 11 participating life insurers — including L&G — stayed above minimum capital requirements under a scenario that modelled a deep global recession, falling rates and sharp asset‑price declines. ^[19]

Crucially, unlike bank tests, these results don’t directly set capital requirements, but they are a signal to markets and policymakers that the sector can absorb severe shocks while continuing to meet obligations. For a business that promises to pay pensions decades into the future, that matters.

Simultaneously, L&G remains part of a broader UK conversation about how pension assets are invested. The Mansion House Accord sees major pension schemes and insurers, including Legal & General, pledging to allocate up to 10% of portfolios to “productive assets” such as infrastructure and private equity by 2030, with a heavy UK tilt. ^[20]

That’s both an opportunity (more fee‑rich private markets) and a risk (political scrutiny, pressure to “invest patriotically”, and exposure to illiquid assets).

Political and macro overhang: UK Budget anxiety

If you want a sense of why the share price hasn’t simply floated higher with all that PRT momentum, CEO António Simões basically spelled it out in an October Reuters interview. ^[21]

A few points he made:

Budget uncertainty: Concerns around potentially higher taxes on savers, wealth and business in the upcoming UK Budget are causing investors to sit on their hands.
“Proxy for the UK economy”: Simões explicitly framed L&G as a bellwether for sentiment towards the UK, noting that fears around fiscal sustainability and future tax policy weigh on the stock.
Show‑me phase: He acknowledged that investors are in a “show‑me” mood after the group pared back its dividend‑growth ambitions in a 2024 strategy update, promising instead a mix of dividends and buybacks totalling £5bn over three years.
Bulk annuities still booming: He pushed back on fears the PRT boom is peaking, saying L&G had secured £11bn of buy‑outs so far in 2025 and was not seeing demand slow.

More broadly, 2025’s Autumn Budget is reshaping parts of the pension tax landscape, including salary‑sacrifice reforms that will cap the amount of salary employees can sacrifice while retaining full National Insurance relief from 2029. That has implications for long‑term savings behaviour and workplace pensions — core markets for L&G — even if the earnings impact is more medium‑term. ^[22]

Balance sheet quality: ROE, leverage and solvency

Simply Wall St’s fresh analysis on 3 December zeroes in on two uncomfortable truths for more conservative investors: ^[23]

L&G’s return on equity (ROE) is estimated at about 12%, using £301m of net profit over £2.4bn of equity for the 12 months to June 2025. That’s respectable but slightly below an insurance‑sector average around 15%.
The group’s debt‑to‑equity ratio is flagged at about 11.16, which Simply Wall St characterises as “alarmingly high”, arguing that modest ROE combined with high leverage is a negative signal.

Regulatory capital ratios tell a more comfortable story — Solvency II coverage above 200% gives a big cushion against shocks — but high headline leverage is one reason some investors insist on a fat dividend yield as compensation. ^[24]

That tension — solid regulatory metrics vs alarming-looking accounting leverage — is at the heart of the valuation debate.

Insider buying: small cheques, useful signals

Over the last few weeks, there has been a steady drip of insider buying in LGEN shares, which is giving “skin in the game” fans something to point at:

Chairman John Kingman bought 674 shares at 244p on 1 December, after purchasing 679 shares at 242p in early November. ^[25]
Non‑executive director Mark Jordy acquired 1,076 shares at 244p on 1 December, having already bought two smaller tranches totalling 1,990 shares at 241p in early November. ^[26]
An RNS‑linked update summarised Legal & General’s total voting rights at 5,697,344,679 ordinary shares as of 28 November, with no treasury shares held — useful context for gauging the size of these insider purchases. ^[27]

On top of that, a TipRanks write‑up notes that several executives, including the Group CFO and Group Chief Risk Officer, bought shares under the company’s Employee Share Plan on 1 December, explicitly framed as an alignment of management and shareholder interests. ^[28]

None of these transactions is huge in sterling terms, but the pattern — multiple insiders buying at prices around current levels — tends to be read as a mild vote of confidence rather than a red flag.

Analyst ratings and stock forecasts

Sell‑side and data‑driven views are not monolithic, but they cluster around “high income, modest upside, meaningful risk”.

Traditional broker research

MarketBeat’s summary of recent broker research on LGEN shows: ^[29]

Consensus rating: “Moderate Buy”
Average 12‑month target price: about 257p
Rating mix (5 analysts):
- 1 × Strong Buy
- 2 × Buy
- 1 × Hold
- 1 × Sell

Within that mix:

Peel Hunt: “Add” with a 255p target.
JPMorgan Chase & Co.: downgraded to “Neutral”, cutting its target from 290p to 275p.
Royal Bank of Canada: “Underperform”, lifting its target from 200p to 210p — distinctly cautious versus the pack.
Berenberg: “Buy”, nudging its target up to 289p.

TS2’s recent share‑price commentary also cites broader analyst data with an average target near 266p and a range roughly from just above 200p to the mid‑350s, again implying modest upside from late‑October levels but substantial disagreement. TS2 Tech+1

Quant and AI‑driven views

Different style of analysis, similar ambivalence:

Danelfin AI Score: 5/10 (“Hold”), with a 49.32% probability of beating the STOXX 600 over the next three months — slightly below the average probability for European stocks. ^[30]
TipRanks AI analyst (“Spark”): Neutral on GB:LGEN, pointing to financial‑performance challenges and a high P/E multiple offset by an attractive dividend yield; technicals are seen as mildly bullish but not enough to scream bargain. ^[31]

Retail commentary

On the retail‑investor side, a recent Yahoo Finance article notes that a hypothetical £5,000 invested in Legal & General at the start of 2025 would now be worth more once dividends and price gains are included, highlighting how the near‑double‑digit yield has been a magnet for ISA investors this year.

Put together, the consensus message is: solid yield, modest expected capital upside, real but not catastrophic risk.

Stock valuation: cheap or correctly cautious?

Depending on which number you pick, LGEN looks either optically expensive or very cheap:

Hargreaves Lansdown shows a trailing P/E above 80x, distorted by IFRS noise. ^[32]
MarketBeat’s calculation lands lower, around 55x, but still high compared with many other FTSE 100 financials. ^[33]

That apparent contradiction is why many investors ignore P/E entirely here and focus instead on:

Dividend yield and its trajectory. ^[34]
Solvency II capital coverage and generation. ^[35]
Value of new business and PRT margins. ^[36]
Structural growth in DC pensions and retail annuities. ^[37]

From that angle, you can think of LGEN less as a “55x earnings” stock and more as a leveraged, regulated utility with an 8–9% distribution yield, where the real questions are: How safe is the cash generation, and how long can management keep growing it in real terms?

Key risks into 2026

The main bear arguments showing up in recent analyses and commentary include: ^[38]

High leverage and complex balance sheet
- Life insurers are by design balance‑sheet beasts. The 11× debt‑to‑equity ratio highlighted by Simply Wall St and MarketBeat’s debt‑to‑equity metric above 150 reinforce the sense that this is not a “sleep easy” balance sheet if markets turn violently.
PRT competition and pricing pressure
- The Ford deal underlines L&G’s strength in the PRT market, but new entrants — AmTrust, Brookfield‑backed vehicles, Apollo‑linked platforms — are intensifying competition. If pricing tightens, the risk is that volumes remain high but margins erode.
UK macro and policy risk
- L&G is explicitly positioned as a proxy for the UK’s fiscal credibility and long‑term savings regime. Budget changes that weaken pension tax incentives or spook gilt markets could hurt both flows and asset values.
Regulation and capital demands
- While the latest BoE stress test was reassuring, future changes to Solvency UK or international capital rules could affect how much cash L&G can safely earmark for dividends and buybacks.
Interest‑rate and credit risk
- A faster‑than‑expected fall in interest rates could squeeze reinvestment yields, while a credit downturn would put pressure on the private‑credit and real‑estate books that underpin annuity promises.

None of these risks is unique to L&G, but the combination explains why the yield remains so high compared with the wider FTSE 100 and even compared with some insurance peers.

Why the bull case is still alive

Despite the caution, plenty of investors and commentators remain constructive on LGEN. Bullish arguments generally lean on: ^[39]

Scale and track record in PRT: Completing almost half of the 20 largest UK PRT deals since 2007 is not an accident; it’s a moat.
Structural tailwinds in pensions: The shift from defined‑benefit to defined‑contribution, ageing populations and regulatory nudges towards consolidation into “megafunds” all favour large, vertically integrated players like L&G.
Capital‑return commitment: The £5bn three‑year capital‑returns plan, on top of a current yield near 9%, is a powerful attraction for income‑focused shareholders.
Diversified earnings engines: Institutional retirement, retail savings/protection and asset management — especially private markets — together provide multiple levers for growth.

Seeking Alpha and other fundamental commentaries over the year have argued that, despite only “modest” share‑price gains, LGEN’s combination of yield, solvency and capital‑return policy remains “alluring” for investors comfortable with UK macro and insurance complexity. ^[40]

Who Legal & General stock may suit (and who it probably doesn’t)

Potentially suitable for:

Investors prioritising high income over rapid capital growth.
Those willing to hold a cyclical, highly regulated financial through full cycles, accepting mark‑to‑market volatility.
People comfortable reading through IFRS noise to focus on cash generation and solvency rather than headline P/E.

Potentially unsuitable for:

Investors who want clean, simple balance sheets and low leverage.
Those who are heavily underweight the UK already and do not want a stock that management itself calls a proxy for the UK economy and fiscal credibility. ^[41]
Anyone who dislikes sectors where regulatory and political changes can move the goalposts quickly.

This article is for information and analysis only and is not personal investment advice. Whether LGEN belongs in a given portfolio depends on individual objectives, risk tolerance and tax circumstances.

Bottom line: high‑yield puzzle, not a no‑brainer bargain

As of 3 December 2025, Legal & General Group Plc is:

Trading around 248p, mid‑range in its 12‑month band. ^[42]
Offering a historic dividend yield close to 9%, with management committed to multi‑year capital returns. ^[43]
Delivering mid‑single‑digit growth in operating profit and EPS, and record‑scale PRT transactions like the Ford £4.6bn buy‑in. ^[44]
Carrying high leverage and operating in a regulatory and political environment that can change suddenly. ^[45]
Viewed by analysts as a Moderate Buy with consensus targets only slightly above today’s price, and by AI models as a hold with average odds of outperformance. ^[46]

For some investors, that mix — fat income plus modest upside in exchange for complexity and UK policy risk — is exactly the kind of trade‑off they want. For others, the high yield is less a gift and more a warning siren.