On Thursday, BofA Securities adjusted its stance on shares of Legal & General Group PLC (LON:LGEN:LN) (OTC: LGGNF), upgrading the stock from Neutral to Buy. The firm also revised its price target upwards to GBP2.75 from the previous GBP2.68, indicating a positive outlook on the company's long-term growth prospects.
The upgrade comes despite a recent decline in Legal & General's share price, which dropped by 5.5% on Wednesday and has seen a 9.4% fall in less than a week. This decline was attributed to investor reactions following the company's capital markets day, which appears to have generated some short-term disappointment among shareholders.
BofA Securities believes that the market's reaction to Legal & General's recent decisions and announcements has been overly negative. The firm suggests that the current weakness in the stock price more than accounts for the long-term nature of Legal & General's investment strategy. According to the firm, the company maintains market-leading operations and has attractive prospects for future growth.
The slight reduction in the price target to GBP2.75 from an earlier target of GBP2.68 is accompanied by a trim in the profit outlook (PO) by 3% to 268p, down from the previous estimate of 275p. Despite this adjustment, BofA Securities' upgrade reflects confidence in Legal & General's strategic choices and its potential for long-term value creation for investors.
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