London, Jan 28, 2026, 09:39 GMT — Regular session
- Aviva’s stock edged up roughly 0.9% during early London trading.
- UBS singled out Aviva as its top pick among UK life insurers, favoring it over Legal & General.
- Investors are eyeing March 5 for results, looking closely at buyback updates and details on Direct Line integration.
Aviva shares climbed roughly 0.9% to 631.6 pence on Wednesday, with investors gearing up for the insurer’s full-year results set for March 5. 1
The move is modest, but the timing is key. Aviva’s upcoming update should provide concrete figures on cash returns — dividends and buybacks — revealing if the Direct Line integration is translating into capital and earnings instead of just headlines.
UBS analyst Nasib Ahmed reiterated on Jan. 26 that the bank favors Aviva over Legal & General, highlighting its “well-protected balance sheet, high capital generation yield and diversification.” 2
UBS has set a 750p target on Aviva, per an Interactive Investor report, and contends Aviva holds up better than Legal & General in a market stress test. “Our sensitivity analysis indicates that Aviva is much better protected under a market stress,” the bank noted. 3
That “protection” mainly refers to solvency — the capital buffer insurers are required to maintain under Solvency II regulations. A bigger buffer gives management extra leeway to continue dividends or resume buybacks during market turbulence.
Aviva has been integrating Direct Line since last year, following approval from the UK competition watchdog. The insurer has told investors it expects quicker earnings growth and larger cost savings from the merger. 4
Earlier this month, Aviva announced that the Prudential Regulation Authority had approved its request to revoke Direct Line’s Solvency II partial internal model. The group said this move paves the way to transition Direct Line onto Aviva’s own model gradually. Aviva also confirmed it remains on track to deliver over £500 million in total capital synergies by around the end of 2026. 5
The broader London market showed strength this week, with the FTSE 100 finishing Tuesday up 0.6% thanks to gains in bank shares. Investors were also focused on an upcoming U.S. Federal Reserve decision. 6
Insurers face a snag, though. When credit spreads widen or equity markets tumble, solvency can deteriorate fast. The strain typically hits buyback programs and “extra” distributions first.
Aviva’s full-year results drop on March 5 at 0700 GMT, offering investors a crucial update. The group is set to clarify its capital return strategy for 2026 and provide a clearer picture of Direct Line’s performance within the figures.
