NatWest Group PLC's £2.7bn deal to buy Evelyn Partners may have spooked the market, but analysts at UBS think the share sell-off looks like an overreaction, and, as such they've kept a 'Buy' rating with a 780p price target, implying almost 29% upside from 605p.
On Monday, the UK bank confirmed the acquisition of Evelyn Partners for £2.7bn - that's 15.1x FY25 adj EBITDA of £179m, for 130bps, UBS said - framing the purchase as a meaningful but manageable capital deployment.
UBS highlighted that NatWest has flagged some £100m of targeted cost synergies, while stressing that Evelyn’s profit pool remains small relative to NatWest’s wider earnings base.
Investors are likely to focus on the deal maths in Friday’s 4Q25 results, UBS added, arguing that even if the bank may struggle to hit an 11% ROIC by FY28 on a clean run-rate basis, the transaction broadens NatWest’s wealth and investment proposition in a way that supports a “faster growing, higher ROTE bank.”