A new deep dive from RBC Capital Markets has put fresh attention on several UK-listed names, with Burberry Group PLC (LSE:BRBY) emerging as one of the Canadian bank's preferred ideas for the year ahead.
The report, covering luxury and premium brands, argues that while 2025 has been weighed down by weak demand, geopolitical uncertainty and worries over generative AI, 2026 should offer a more supportive backdrop for selective stocks.
RBC said Burberry sits near the top of its turnaround list, helped by a reset in product strategy and what it called “low-hanging fruit” in improving retail execution.
It expects “significant” earnings growth in 2026 as margins rebuild from a depressed base, noting that consensus forecasts already show positive revisions for Burberry while most of the sector has seen downgrades over the past year.
Watches of Switzerland Group PLC (LSE:WOSG) also features prominently. RBC views it as a structural growth story, supported by consolidation in luxury watch distribution and the group’s sizeable allocation of Rolex agencies in the UK. But it cautions that the valuation has already rerated and that the business remains exposed to US tariff risk from late 2026.
Dr Martens PLC (LSE:DOCS) earns a more measured assessment: the broker sees early signs of progress under new leadership but warns that its positioning in lifestyle footwear is “relatively unhelpful” in today’s performance-led market. The note also flags the brand’s heavy reliance on the US as a risk factor.