The Legal & General share price is trading at 302.6p, up 16.4% over the past 12 months and just below August’s record peak of 318.1p. Including dividends, LGEN has returned 23.7% over that period. Now, a string of fresh Sell ratings from major banks is testing whether that run has further to go.
Strong H1 results, but a capital ratio miss rattled markets
Legal & General’s H1 2026 results, published 5 August, showed core operating profit up 7% to £918m and core operating earnings per share (EPS) up 11%. Management lifted full-year EPS guidance above the previously stated 6% to 9% growth range.
The Asset Management division led the way. Fee-related earnings in Asset Management rose 37% to £169m from £123m in H1 2025, and the division’s cost-to-income ratio fell 400 basis points to 71%. The interim dividend was raised 2% to 6.24p per share (H1 2025: 6.00p).
The Solvency II Coverage Ratio came in at 201%, sitting above the company’s 160–190% operating target range. Even so, the ratio missed analyst expectations, and according to Investing.com, shares fell in early trading on results day despite beats across profit, EPS, and divisional lines.
The company has completed approximately £450m of its £1.2bn share buyback programme, according to the H1 2026 results. That buyback, the largest in company history when announced alongside full-year 2025 results in March, is funded in part by the sale of the US protection business. Management is targeting more than £5bn of shareholder returns over 2025 to 2027.
What the Legal & General share price is pricing in
The US protection sale, completed last year, brought in $2.3bn (£1.8bn) in cash. The buyer, Meiji Yasuda Life Insurance Company, also acquired a 20% stake in Legal & General’s US Pension Risk Transfer business and a 5% shareholding in Legal & General itself, according to the RNS filed with Investor Meet Company.
The disposal leaves Legal & General focused on capital-light businesses: asset management, workplace pensions, and institutional retirement. Workplace pensions administered assets rose 27% year-on-year to £128bn in H1 2026, and total UK defined contribution assets under management reached £236bn.
Longer term, Investing.com reports that management targets Asset Management operating profit of £500m to £600m by 2028, a cost-income ratio below 70%, and Private Markets assets under management above £85bn.
Those targets appear credible on the H1 trajectory, but at 302.6p the market appears to have moved ahead of some analysts’ valuations.
According to Investing.com’s analyst data, the consensus average 12-month price target stands at 274.20p, implying a fall of roughly 8.7% from current levels. Five brokers carried Sell ratings as of mid-August: JPMorgan at 270p, UBS at 280p, RBC Capital at 270p, Goldman Sachs at 257p, and Jefferies at 191p.
On that consensus, a £9,999 investment today would produce a capital loss. Add a 7.4% forward dividend yield, and the blended total return narrows to around minus 1.3%, leaving an investor with roughly £9,868 in 12 months’ time.
It is worth keeping that figure in context. Legal & General’s share price has wrong-footed consensus before: the stock delivered a 23.7% total return over the past year, a period when analyst opinion was similarly cautious. The Legal & General share price has also demonstrated its capacity to retrace sharply. After full-year 2025 results in March, the stock fell 6% to 243p in early trading before recovering.
The H1 2026 Solvency II Operational Surplus Generation of £790m, up 3% year-on-year, and a commitment to dividend cover targets suggest the income case remains intact. The forward dividend yield of 7.4% is among the higher readings on the FTSE 100.
The binary for shareholders is whether the structural improvement in Asset Management and the capital return programme can continue to exceed expectations fast enough to justify a price that five of the street’s analysts consider stretched. The next test will be the full-year 2026 results and whether management can bring the Solvency II ratio back within its stated 160–190% operating band while maintaining buyback momentum.
