M&G Share Price: HL Believes 2026 Profit Acceleration Supports Valuation

Full-year results from M&G (LON: MNG) drew a negative market reaction on Thursday, before a slight rebound in the company’s shares on Friday despite earnings landing ahead of expectations.

Analysts at Hargreaves Lansdown said the update showed clear signs of operational progress and improving momentum.

The group reported underlying operating profit of £838 million, beating the £820 million expected. Assets under management rose 8.7% to £376 billion, supported by £7.8 billion of net inflows from open business.

Capital strength also improved, with the Shareholder Solvency II coverage ratio climbing to 242% from 223% a year earlier. The total dividend rose 2% to 20.5 pence.

Senior analyst Matt Britzman said in a note reacting to the results that full-year profits were “better than expected” and stated that M&G is “starting to show signs of consistent growth.”

Hargreaves Lansdown highlighted management’s guidance that underlying operating profit should see a “meaningful acceleration” in 2026 and grow by 5% or more annually through 2027.

The analyst explained the company’s dual structure, combining asset management and life insurance, offers benefits but can also weigh on retail demand because it is “tricky for retail investors to understand.”

However, they pointed to improving institutional and retail inflows, progress in the bulk annuity market, and the rollout of a revamped wealth platform as potential tailwinds.

Hargreaves Lansdown also wrote that capital levels “look good” and the 7.1% forward yield appears achievable, though it cautioned that execution risk remains.

The firm believes M&G is “making progress across several key areas,” supporting the investment case as medium-term guidance improves.