Investing.com — RBC expects solid first-quarter 2026 flows for UK wealth management firms, supported by favorable conditions in January and February before market volatility dampened trading in March.
The bank previews first-quarter 2026 flow reporting for the sector, which begins with Brooks Macdonald Group (LON:)on Wednesday. RBC made minor negative revisions for net flows for most companies, reflecting more challenging conditions anticipated in March, when market volatility likely dimmed retail investor sentiment.
Despite this, RBC expects decent net flows at the sector level for the quarter, reflecting supportive conditions in the first two months, including positive portfolio returns and the benign UK Budget outcome in November.
RBC made minor revisions to flow estimates for second-quarter 2026, with flow expectations for the rest of the year on watch pending geopolitical developments. The bank looks to management commentary to provide details around changes in trading across March and early April.
Drawing on 2022 as a case study, RBC notes that organic growth remained positive even in a challenging macro environment, with higher interest income providing an earnings offset to lower markets. Valuations are already close to 2022 trough price-to-earnings levels, and capital returns averaging 5.1% of market cap provide meaningful downside support.
Most companies are trading towards the lower end of the price-to-earnings range across 2020 to present. Focusing on the 2022 experience, RBC shows that current price-to-earnings ratios are already close to the minimum reached that year for most names.
Tatton Asset Management PLC (LON:), St. James’s Place PLC (LON:), IntegraFin Holdings PLC (LON:) and BRK have implicitly derated year-to-date with share price moves more negative than earnings per share revisions.
RBC maintains Outperform ratings on Quilter PLC (LON:), Rathbones Group (LON:), IntegraFin Holdings PLC (LON:) and Tatton Asset Management PLC (LON:).
The bank made minor negative revisions to all names except Tatton Asset Management PLC (LON:) and AJ Bell PLC (LON:). RBC expects the market to attach most significance to updates from St. James’s Place PLC (LON:) and Brooks Macdonald Group (LON:).