Aviva Share Price Hits New High After Half-Year Surge
Aviva’s share price is on a roll again. The FTSE 100 insurer saw its stock climb sharply following strong half-year results. Investors are cheering.
CEO Amanda Blanc’s strategy continues to pay off. Since her arrival in 2020, she has cut back underperforming overseas units and focused on the UK. This year’s £3.7bn acquisition of Direct Line adds more muscle to Aviva’s market position.
Half-Year Numbers Impress
The latest results, released today (14 August), show operating profit up 22% to £1.07bn. “66% of our profit now comes from capital-light operations such as wealth, health and general insurance,” the company confirmed.
UK and Ireland general insurance premiums rose 9% to £4.14bn. Wealth net inflows increased 16% to £5.8bn. Assets under management now exceed £200bn.
The Direct Line deal closed in July, so its impact is not yet in the numbers. Management expects it to boost earnings per share by roughly 10% once fully integrated.
Investors reacted immediately. Early trading saw Aviva shares jump more than 3%. Momentum is strong, but high expectations remain a challenge.
Sector Standout
Blanc’s turnaround is evident. General insurance operating profit surged 29% in H1, helped by disciplined pricing and new business growth. Health premiums rose 14%, while retirement sales dipped slightly, offset by a 29% jump in individual annuity sales.
Aviva now serves around 21 million customers—roughly four in ten UK adults. Few UK insurers can match that scale.
Valuation and Dividends
The shares are no longer a bargain, trading at a price-to-earnings ratio of roughly 28.7. Consistent performance is crucial.
Dividends remain attractive. The board increased the interim payout by 10% to 13.1p per share. Forecasts suggest a yield of 5.81% this year and 6.24% in 2026, above the FTSE 100 average of 3.5%. With strong cash flows and a Solvency II cover ratio of 206%, Aviva looks solid.
Risks Ahead
Challenges remain. A major catastrophe could dent insurance profits. Integrating Direct Line may take longer than expected. Annuity sales could drop if interest rates fall. Inflation, however, could keep rates higher for longer.
Analysts’ 12-month consensus target is 649.2p—about 5% below the current 679.2p. Aviva may slow after this rapid climb.
Blanc’s leadership has transformed Aviva. Long-term prospects remain appealing. Income-focused investors may find the stock especially attractive. But others might explore other FTSE 100 or FTSE 250 insurers for potential catch-up plays.
Investors can also check Aviva’s strong half-year results and dividend update for a closer look at the company’s performance.
