Barclays upgrades Just Group, downgrades Aviva

Just Group rallied on Monday after Barclays upgraded the shares to ‘overweight’ from ‘equalweight’ and lifted the price target to 125p from 106p.

"We are positive on the outlook for bulk annuities and Just has the highest exposure amongst the listed UK life insurers that we cover," it said. "We consider management's targeted new business margin and strain achievable, with upside potential if operating earnings growth reaches 15%."

In the same note on UK life insurance, Barclays downgraded Aviva from ‘overweight’ but upped the price target to 480p from 468p.

"We expect bulk annuity volumes to remain robust at £30-50bn per year for the next 3-5 years," it said.

"Conversely, we anticipate pedestrian volumes in retail annuities as consumers face an inflation-driven cost of living crisis. We favour insurers with exposure to bulk annuities (Just, L&G) and downgrade Aviva to ‘equalweight’."

At 0915 BST, Just Group shares were up 7% at 96.45p, while Aviva shares were down 1.2% at 439.30p.