Aviva shares were sharply higher on Friday after the Times reported multiple parties were circling the insurer after a prolonged period of disappointing share price returns.

Aviva will look good value to potential bidders after the company’s valuation failed to recover fully from the pandemic despite strong underlying performance.

“Is Aviva the next FTSE 100 takeover target? The market certainly seems to think so, judging by the 7% share price jump on Friday. Chatter that foreign players Allianz, Intact Financial and Tryg are among the potential interested parties has fired up the shares, hot on the heels of a bullish broker note earlier this week,” said Russ Mould, investment director at AJ Bell.

“What might they see in Aviva? Well, the business is forecast to have strong free cash flow and excess capital and its valuation is cheap. It has slimmed down in recent years to focus on the stronger parts of the group and there is now an opportunity to increase its position in bulk annuities which looks like a more prosperous market thanks to higher gilt yields.

“Activist investor Cevian Capital is no longer on the shareholder register causing mischief and Aviva is left as one of many stocks on the UK market looking unloved but still offering the potential for long-term value generation.”

Aviva shares were 7% higher at the time of writing in London.

ExxonMobil is in advanced talks over the acquisition of Pioneer Natural Resources for up to $60 billion, according to reports Wall Street Journal.

The pre-market trading value of Pioneer was up 11.70% to $240.22. Exxon shares dropped 1.7% in the pre-market on Friday. 

News on the deal first appeared in Wall Street Journal on Thursday, when the paper reported on the high likelihood of the deal being done in the coming days.

Pioneer Natural Resources is the third biggest oil producer in the Permian Basin and the tie-up would create an oil behemoth controlling substantial oil production in the region.

The deal is to be the biggest one since the 1991 purchase of Exxon for $81 billion. Exxon is the top U.S. oil producer and its market value was $436 billion at the time of writing.

JD Wetherspoons has recorded its first annual profit since the pandemic as revenues soared 12.7% in the 52 weeks to 30th July 2023.

The company has enjoyed a resurgence after the pandemic and selling more pints has helped Wetherspoon’s Free cash inflow per share increase over 1,00% to 211.4p.

Operating profit rose 92% to £106m but Wetherspoon did not declare a dividend for the period.

“The home of some of the UK’s cheapest pints has reason to be cheerful. The growth in today’s full year results has seen all revenue streams rise above pre-pandemic levels, and so far this year like for like sales are 17.3% ahead of 2019. Margins also recovered well last year. The group notes increasing certainty over cost inflation, giving cause for hope that margins can keep going in the same direction,” said Derren Nathan, head of equity research at Hargreaves Lansdown.

“The group has also made meaningful inroads into its debt pile last year with underlying net debt down £250m to £642m including the repayment of the £100m owed under the Coronavirus Large Business Interruption Loan Scheme. That’s been enabled by strong free cash flow, the prudent sale of the company’s interest rate swaps, and proceeds from reducing the size of the estate. The dividend is still off the table, and in the current interest rate environment, prioritising debt reduction is a sensible approach.”

The FTSE 100 gained on Thursday with Imperial Brands leading the index higher as concerns about higher bond yields abated and investors adjusted to forward expectations of interest rates.

The FTSE 100 was up 0.4% to 7,443 shortly after midday in London as investors stepped back into equities after several negative sessions driven by interest rate worries.

“It looks like a typical knee-jerk reaction by investors – there have been plenty of signs to suggest central banks will continue with their fight against inflation by keeping rates high, but a lot of people seem to have been too complacent and expected a sudden drop in rates,” said Russ Mould, investment director at AJ Bell.

“With the message now loud and clear that this situation is unlikely in the near-term, investors can have some sort of certainty and thus reposition their trades accordingly.”

Tesco added to yesterday’s gains adding another 3.4% to 280p. Imperial Brands was the top gainer after announcing trade was in line with guidance and saw further growth in their new generation products.

“The maker of Lambert & Butler cigarettes and blu vapes has bounced back from a sluggish first half.  Imperial Brands is now set to deliver modest growth in revenue and operating profit for the year just ended,” said Derren Nathan, head of equity research at Hargreaves Lansdown.

“This is particularly encouraging given the inclusion of the now suspended Russian operations in last year’s comparators. There has been growth in all product categories despite an industry wide decline in tobacco consumption.”

Imperial Brands shares rose 3.7%.

Falling oil prices hit majors BP and Shell who were the FTSE 100’s top fallers, shedding 1.7% and 1% respectively.