Panmure Liberum reckons the outlook for UK asset and wealth managers remains broadly 'constructive' despite persistent headwinds for fund flows, with firmer markets providing a welcome tailwind across the sector.
In its latest quarterly note titled “Hold hard the breath,” the broker said equity markets have been “relatively benign” in recent months, helping lift estimates even as the flow environment continues to look challenging.
The broker added that while hopes of a retreat in US mega-cap dominance have yet to be realised, there are tentative signs of a broadening in investor focus and a “continued belief in the role of active management.”
Panmure Liberum continues to prefer “self-help stories,” highlighting Schroders’ portfolio streamlining and Man Group’s rapid rebound in fund performance.
Jupiter was flagged as the “star performer” last quarter following its CCLA acquisition, which promises material earnings enhancement and strengthens client retention.
Analysts see the upcoming Budget as “both threat and opportunity,” with higher taxes likely to weigh on flows, but potentially driving greater demand for financial advice.
Panmure Liberum, in the note, said it sees continued value in St James's Place PLC (LSE:STJ), Quilter PLC (LSE:QLT) and Brooks Macdonald Group plc (LSE:BRK), and argues that trends including ageing populations and rising financial complexity remain “hugely supportive” for the sector overall.