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Legal & General (LGEN) 124.7p

On Tuesday 18 March the UK’s third biggest insurer’s full-year figures sent the shares 4.3p higher initially in a rallying market. But Graham Neale, head of equities at Killik & Co, reckons the results were ‘underwhelming’, with EEV operating profit at £912 million against the £1 billion analysts were expecting. He says Legal & General’s overexposure to the UK is a concern. Insurance premium rates are declining in the UK and the market for life insurance products, from pensions to annuities, is very challenging. Increasing life expectancy is also taking a toll. The company admits this and we expect investors to realise that the growth outlook at Legal & General is not so bright. The price is riding a downtrend, and has been following the movements of the main index. We go short to take advantage of this trend, placing a stop loss at 132p.

ACTION: SELL Legal & General • Target 112.5p • Stop loss 132p

TIME TARGET: 4 WEEKS