UBS lifts St James's Place target as market gains offset AI disruption fears
Published: 11:01 03 Jul 2026 EDT
UBS has nudged up its price target on St James's Place PLC (LSE:STJ), the FTSE 100 wealth manager, to 1,530p from 1,520p, pointing to around 20% upside from the current level of 1,277p.
The bank kept its buy rating, arguing that strong equity market gains during the second quarter should more than offset a softer outlook for new client money.
Analyst Nasib Ahmed said market returns of around 10% over the period would lift funds under management to an estimated £241.5 billion, some 9% ahead of consensus.
That higher forecast drives positive earnings revisions, with UBS raising its per-share earnings estimates by 11% in the near term.
The upgrade comes despite a more cautious take on fund flows.
UBS now builds a harsher artificial intelligence disruption scenario into its base case, assuming gross inflows stop growing from 2027, rather than 2030 as it previously modelled.
The concern is that AI-driven advice tools could compete with the face-to-face model at the heart of the St James's Place business.
The bank expects gross inflows of £5.45 billion and net inflows of £1.45 billion for the quarter, running 7% and 17% below consensus, respectively.
Net flows are forecast to keep shrinking, turning negative by 2030.
Even so, market performance of around 5% a year is expected to remain the main engine of asset growth over the medium term.
St James's Place trades on about 11 times UBS forecast 2027 cash earnings, below rivals Quilter and AJ Bell, which sit in a range of 14 to 18 times.
Ahmed flagged several debates likely to surface at half-year results on 29 July.
These include slower fund flow growth, a shift towards lower-margin products such as unit trusts and ISAs, and regulatory pressure from proposals for lighter-touch targeted support.
The bank does not expect a further provision release at the half-year stage, pencilling in a share buyback of £45 million.
