Can anyone reading this post answer this query - I am not qualified in this area.
My holding is twice my target position size. I should have sold part at 280p+, but foolishly skipped my own precepts on diversification (15% of my dividefensive portfolio, should be 7%).
Comforted by the yield: 8.5% - payout ratio: 50% - cash payout: 6%.
9 on last 10 yrs of divi increases at 5% on ave increase every yr for last 5 yrs. The recent post covid average yield has been about 7.5% and as it's currently at 8.5%, it implies that the share price is depressed as people buy legal and general for the Divi.
Patiently waiting 280-300 band, in ? 2-3 yrs time?
The worry is the debt pile, and exposure to rising int rates and the property market, debt is over 6 times equity, this ratio up by a half these last 5 yrs, once is already enough.
All opinion and advice welcome.
Comforted by the yield: 8.5% - payout ratio: 50% - cash payout: 6%.
9 on last 10 yrs of divi increases at 5% on ave increase every yr for last 5 yrs. The recent post covid average yield has been about 7.5% and as it's currently at 8.5%, it implies that the share price is depressed as people buy legal and general for the Divi.
Patiently waiting 280-300 band, in ? 2-3 yrs time?
But debt is a qtr of cash flow and interest is covered 14 times by EBIT.
For every basis pt rise in interest rates, how much does this shave off EPS? I don't know but I should do as this is clearly the driver of the precipitous falls in the share price.
EPS this yr: 36p, next yr: 41p, divi is: 20p. ROCE is pretty much zero, 0....not good.
According to my grand dividend strategy and investment process, which is very difficult to implement I have to admit!, I look first for companies with earnings from outside the UK, then I look for diversification across sectors and the business cycle, and then within a sector I look for the best future return on my investment.
Lastly, I try to get the timing right which is your question Alex using a bit of technical analysis ("a bit" is all I have at the moment). LGEN is currently 7.06% under its 50-day simple moving average, prices stay below this which suggests a short term bearish trend and 6.62% under the 200 DMA, same conclusion for the longer term. The RSI at 44.4 is weakly bearish.
So looks like we're in a lateral Trend the transaction volumes are half what they usually are and so I would say it is as safe to buy as it is to sell, but hold is best for the longer term ie once we get over this inflation / interest rate mountain...if....
All that sounds very grand, but making it work is a bit of a nightmare!! Fundamentally it's a really sound company going through a bad patch at the moment with its exposure to interest rate hikes which I think is much overdone in legal and Generals case.
TA is good at the moment of decision, if you're a trader (not me).
Sentiment as I say is depressed as is the economy seemingly in stagflation and seemingly heading into a recession.
It's not great but LGEN does have underappreciated defensive qualities... does anyone have any better ideas?For every basis pt rise in interest rates, how much does this shave off EPS? I don't know but I should do as this is clearly the driver of the precipitous falls in the share price.
EPS this yr: 36p, next yr: 41p, divi is: 20p. ROCE is pretty much zero, 0....not good.
According to my grand dividend strategy and investment process, which is very difficult to implement I have to admit!, I look first for companies with earnings from outside the UK, then I look for diversification across sectors and the business cycle, and then within a sector I look for the best future return on my investment.
Lastly, I try to get the timing right which is your question Alex using a bit of technical analysis ("a bit" is all I have at the moment). LGEN is currently 7.06% under its 50-day simple moving average, prices stay below this which suggests a short term bearish trend and 6.62% under the 200 DMA, same conclusion for the longer term. The RSI at 44.4 is weakly bearish.
So looks like we're in a lateral Trend the transaction volumes are half what they usually are and so I would say it is as safe to buy as it is to sell, but hold is best for the longer term ie once we get over this inflation / interest rate mountain...if....
All that sounds very grand, but making it work is a bit of a nightmare!! Fundamentally it's a really sound company going through a bad patch at the moment with its exposure to interest rate hikes which I think is much overdone in legal and Generals case.
TA is good at the moment of decision, if you're a trader (not me).
Sentiment as I say is depressed as is the economy seemingly in stagflation and seemingly heading into a recession.
All opinion and advice welcome.
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