The Dividend Forecast for Legal & General Shares Raises Questions About Sustainability
Legal & General's forecasted dividend increase for 2025 and 2026 may be unsustainable due to declining coverage of expected earnings. The company's asset management division is vulnerable to economic downturns, which could impact profits and dividend payments. Additionally, the firm's large share buyback plan could lead to decreased payouts if investor appetite wanes.
- The high degree of reliance on dividends in Legal & General's payout strategy makes it crucial for investors to scrutinize coverage ratios and assess potential risks.
- How will changing market conditions, such as a shift towards sustainable investing, impact the long-term viability of Legal & General's dividend payments?