Legal & General Group plc is engaged in life assurance and long-term savings business, investment management, and various general insurance and health business. The Company operates through six segments: Legal & General Retirement (LGR), which includes annuities (both individual and bulk purchase), longevity insurance and lifetime mortgages; Legal & General Investment Management (LGIM), which includes institutional and retail investment management and workplace savings businesses; Legal & General Capital (LGC), which includes the medium-term investment return (less expenses) on group invested assets; Insurance, which includes the business in retail protection, group protection, general insurance, networks, and Legal and General Netherlands; Savings, which includes the business in platforms, self-invested personal pensions (SIPPs), mature savings and with-profits, and Legal & General America (LGA), which includes protection business written in the United States.
The chart of LGEN.L is shown below in my normal format. The price is charted in candlestick format with the VectorVest valuation as the green line study in the same window. In the window below the price the blue line study shows earnings per share (EPS).
The share is much undervalued and is growing EPS linearly and reasonable safely with a RS score of 1.18. The earnings potential over a window of three years into the future (RV) is excellent at 1.62.
At present the share is breaking out of horizontal resistance at 250p that’s been holding the share over the past year. From a technical aspect I like the rising bottoms charted since the referendum rout in June.
On VectorVest the hold recommendation changed to buy, yesterday, the 1st March 2017.
I am positive about the general market over the next few months although there will be pullbacks along the way.
Through 250p LGEN.L looks as if it can move upwards towards the technical objective of 340p relatively quickly.
As always let’s trade the market as defined by the signals on VectorVest and not the forecast.
David Paul
March 2nd 2017
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